ABSTRACT
In the year 1979-80, the industrial sector – defined to include mining, manufacturing, construction, electricity, gas and water supply – accounted for 24 per cent of India's total ndp. The share of manufacturing industries in the total value of industrial output was 69 per cent. The Industrial Policy Resolution of 1956 gave a concrete shape to these objectives by demarcating the spheres of activity of the public and the private sectors. Seventeen industries, including several of the capital goods industries, were to be the exclusive preserve of the State. The main policy instruments of the strategy were tariffs and quantitative restrictions on imports, coupled with a detailed system of foreign-exchange allocation and a complicated system of industrial licensing. In addition there were price and distribution controls over key industrial inputs. Three recognized features of the performance of India's manufacturing sector over the period 1951—65 are growth in capital intensity, growth in labour productivity and a decline in overall productive efficiency.
