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Unit 7: Indian Industries

during the five-year period. Khadi, handloom and power loom cloth production enhanced from Notes
1,610 million metres to 2,150 million metres.

7.3.2 Industries in the Third Plan (1961-66)

In this section, you must understand that with the base developed in the first two Plans, the
Third Plan called for the maximum rate of ill vestment to (a) reinforce industry, power and
transport, and (b) quicken the process of industrial and technological change.
The complete financial outlay in organised industries and mining during the Third Plan era was
` 3,000 crore, out of which the outlay in the public sector was nearly ` 1,700 crore and that in the
private sector ` 1,300 crore.

Notes The key role in industrial development programme is for the public sector.

The target of industrial development programme was to make the economy self-sustaining in
producers’ goods industries like steel, machine building, etc., so that the quantum of external
assistance required could be curtailed to a very low level. A total target of 7 per cent rise in
industrial production was envisioned in the Plan.

Apart from the year 1965-66, industrial output enhanced steadily at the rate of 7.6 per cent
annually. The accomplishment was lower than the average of 14 per cent per annum observed in
the plan. Although the rise in the output of producer and basic industries was greater than the
real growth in the general index of production, yet it was much lesser than the target set out in
the Third Plan.
In spite of the overall under-achievement of targets the Third Plan mirrored the first stage of a
decade or more of intensive development resulting in a self-reliant and self-generating economy.
Engineering industries such as automobiles, diesel engines, cotton textile machinery, electric
transformers and machine tools, advanced as per set-targets as did industries like heavy chemicals,
petroleum products, cement, etc. Mining and extractive industries also depicted considerable
progress. It was during this era that a fairly sound base for future industrial growth was laid
through the conclusion of projects of the HEC for manufacture of machinery and equipment for
steel plants, the MAMC for the production of mining equipment as well as Bharat Heavy Electricals
for power generation and transmission equipment.

7.3.3 Industries in the Fourth Plan (1969-74)

You must be aware that the Fourth Plan intended to finish industrial projects assumed in the
Third Plan. It also targeted to increase capacities in export promotion and import substitution
industries.
During the Fourth Plan, the real outlay on organised industry was of the order of ` 2,700 crore
in the public sector. Hence, the financial investment was short of the targets set out in the Fourth
Plan. Nearly three-fourths of the total investment was in the core sector, namely, iron and steel,
fertilisers, non-ferrous metals, petroleum and petrochemicals, coal and iron ore.
The performance in industry was far short of even the modest targets set out in the Fourth Plan.
On an average, the growth rate in industry was nearly 5 per cent which was much under targeted
growth rate of 8 per cent envisioned in the Plan.
It is important for you to understand programmes of industrial development in the Fifth Plan
were framed keeping in view the goals of self-reliance and growth with social justice.

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