What were the different categories of industries according to the Industrial Policy Resolution of 1956?

Solution

The Industrial Policy Resolution of 1956 was the basis of second-five-year plan. The plan tried to build the basis for a socialist pattern of society. The industries were classified into three categories:

(i) The first category comprised industries, which would be exclusively owned by the state.

(ii) The second category consisted of industries in which the private sector can supplement the efforts of the state sector; with the state taking the sole responsibility for starting new units.

(iii) The third category consisted of the remaining industries, which were to be in the private sector.

There was a category of industries left to the private sector, the sector was kept under state control through a system of licenses. No new industries was allowed unless a license was obtained from the government. This policy was used for promoting industries in backward regions. In backward regions such industries were given certain concessions in taxes and electricity tarrifs to promote regional equality.

Some More Questions From Indian Economy 1950-1990 Chapter

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Indian Economy 1950-1990

What were the different categories of industries according to the Industrial Policy Resolution of 1956?

Some More Questions From Indian Economy 1950-1990 Chapter

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