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Indian Economy

Notes Self Assessment

Fill in the blanks:
1. Punjab and …………………… are agrarian states and contribute 40 per cent of the total
agriculture production in India.

2. About …………………… per cent of the total population of these states directly or indirectly
depends on agriculture for their livelihood.
3. Punjab and Haryana are self-sufficient in food production and led the country’s Green
Revolution in the …………………….

13.2 Problems and Future Prospects

This section emphasises on the problems and future prospects. Punjab captures a place of pride
in the industrial map of India which is accredited to its small-scale industrial sector. The state
received a very weak industrial base when divided in 1947 and underwent further erosion when
it was reorganised in 1966. More lately, it has been through a period of terrorism and social
unrest, which not only impacted the industrial growth adversely but tended to cause some out
migration of industry. With the re-establishment of peace, the state government tried to stimulate
the process of industrial development with the hope to enter into a new period of progress.

You must understand that the promotion of the small-scale sector in India has been a significant
thrust of industrial policy since independence though the150 emphasis of concern altered with
the priorities of each five year plan. The six Industrial Policy Resolutions which have been
bordered since 1948 have set out the guidelines for the nation’s industrial development with
different degrees of focus on the main goals. The Industries Development and Regulation Act of
1951 offered the basic framework for the post-independence industrialisation strategy. Since the
model for industrialisation in the 1950s was dependant on capital-intensive heavy industries,
the priority of employment generation needed the development of extensively dispersed, labour-
intensive, mass consumption–good producing, small-scale industries. As the process of economic
development resulted in changing priorities, the policy focus shifted to ancillarisation (1980),
regional imbalances (1977), exports and dispersal in rural areas (1990) and then to Small, Tiny
and Village Industries (1991).
The organisational arrangement for SSIs was established in the 1950s with the establishment of
a Small Scale Industries Board in 1954. Other important institutions at the country level were the
Department of Small Scale Industries and Agricultural & Rural Industries and the Small Industries
Development Organisation (SIDO) which was under the Development Commissioner, Small
Scale Industries. At the State level, the Commissioner/Directorate of Industries were the main
institutional authority for SSIs. This structure has remained, though various other institutions
have come into being in the 1970s and 1980s, specifically at the State level.

It is important to note that in the last forty years, several Committees have been comprised by
the Government of India to examine the operation of SSIs with a view to encourage their growth
and efficiency within the context of the main goals of the national economic plans. The Karve
Committee Report (1955) was one of the earliest of these exercises which suggested a protective
environment for the growth of small industries in India. Since then, policies intended for the SSI
sector have objected at fostering its growth through positive policy interventions in the areas of
technology, finance, infrastructure and extension services, among various other requirements
of the sector. Supportive policies through the 1960s, 70s and 80s took the form of reservation of
products completely for the SSI sector (836 products are reserved extensively for SSIs at present)

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