Which of the following was the focus of the Industrial Policy Statement, 1977?
I. Decentralisation of industries
II. Priority to small scale Industries
Show answer & explanation
Correct answer: C
Explanation
The Industrial Policy Statement of 1977, presented by the Janata Party government, was a significant departure from previous policies (especially the 1956 policy). Its primary objective was to prevent the concentration of economic power and create employment in rural areas.
Key Features of the 1977 Policy
Decentralization of Industries: This policy emphasized the shift of industries from large cities to rural and small towns. To this end, District Industries Centers (DICs) were established to provide all facilities to small entrepreneurs under one roof.
Priority to Small and Cottage Industries: This policy focused primarily on small industries. The government reserved a long list of products (over 500 items) exclusively for small industries to protect them from competition from larger industries.
Classification of Sectors:
The small-scale sector was divided into three parts:
Cottage and Household Industries
Tiny Sector
Small Scale Industries
Key Points
This policy was introduced in Parliament by the then Union Industry Minister, George Fernandes.
It was during this policy that strict restrictions were imposed on foreign investment, resulting in companies like Coca-Cola and IBM leaving India.