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Industrial policy Resolution, 1948 of Industrial Policy in India
The main features of the Industrial Policy Resolution of 1948 may be summed up as under






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(i) The role of State enterprise vis-a-vis private enterprise. The basic principle embodied in the policy was that State must play a progressively active role in the development of industries. It was, however, duly recognised that in the circumstances then prevailing in the country, it was not advisable for the State to take over existing units and it was, therefore, decided to concentrate on new units and existing units already under its control. The private sector was to be properly regulated and directed and was assigned an important role in the situation then obtaining in the country.

(ii) Allocation of industries to private and public sectors. Keeping in view the broad principles enunciated above, the Policy Resolution divided the industries into the following four categories for the purposes of their allocation as between private enterprise an State enterprise:

(a) Strategic an basic industries.
The manufacture of arms and ammunition, production and control of atomic energy, and the ownership an management of railway transport were made the “exclusive monopoly of the State”. These industries were even earlier, wholly in the public sector.

(b) Basic and key industries. These included coal, iron and steel aircraft manufacture, ship-building, manufacture of telephone, telegraph and wireless apparatus, etc. The existing units in these industries were to be allowed to continue in the private sector for a period of ten years at the end of which the position was to be reviewed and the question of nationalization was to be decided, if necessary. As for the new units it was laid down that the State would be exclusively responsible for their establishment.

(c) Private sector industries subject to control and regulation by the Government. In this category were placed twenty important industries of the country which were to continue in the private sector though they were to function subject to control and regulation by the Government. These industries included heavy chemicals, sugar, cotton and woollen textiles, cement, paper, salt, machine tools, etc., all of which were considered important in the national interest.

(d) The private and co-operative sector industries. The rest of the industries not covered by any of the categories mentioned above were to be private enterprise-individual as well as co-operative-though they were to be under the general control of State.

(iii) The rule of small-scale and cottage industries. The Policy Resolution afforded due recognition to the importance of small-scale and cottage industries in the economy of the country. It was visualized that they would be organised on co-operative lines and would be integrated and coordinated with large industries.

(iv) Steps toward better Industrial relations. In keeping with the recommendations of the Industries Conference of 1948, the Industrial Policy Resolution of 1948 accepted profit-sharing and other schemes meant to associate labour with the management of industry as steps in the direction of more cordial Industrial relations in the country.

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