ABSTRACT
With the benefit of hindsight we can see four major periods in the evolution of the industrial and technological policies of the Indian state, each period defined by departures from some of the positions taken in the previous period. The first period, 1950–1965, was marked by the state acquiring and keeping the lead in the producer goods sector, i.e. capital goods and some key intermediate goods, leaving almost the entire consumer goods and the non-strategic parts of the intermediate goods sectors to private Indian and foreign capital. During the second period, 1966–1984, the emphasis on state ownership and control of the strategic parts of Indian industry gradually declined, and the strategy of self-reliantly catching up with the West technologically was abandoned in practice (though not in rhetoric). The third period, which spans the years 1985–1991, signalled the retreat of the state from the ‘commanding heights of the economy’. It initiated the entry of the private sector into areas formerly reserved exclusively for the public sector. It also witnessed a strengthening of the strategy of ‘import liberalization for modernization of industry’ which was set in motion already during the latter half of the second period. The onset of the so-called ‘stabilization and structural adjustment programme’ in July 1991 heralds the start of the fourth period. (For a detailed presentation of the Indian government’s industrial policies over the last forty years, the reader is referred to Sandesara, 1992.)
