Current Industrial Policies

8/2/2019 Current Industrial Policies

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CURRENTINDUSTRIAL

POLICIES


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OBJECTIVES

To maintain a sustained growth in productivity;

To enhance gainful employment;

To achieve optimal utilisation of human resources;

To attain international competitiveness and

To transform India into a major partner and player in theglobal arena.


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POLICYFOCUS

Deregulating Indian industry;

Allowing the industry freedom and flexibility in

responding to market forces and

Providing a policy regime that facilitates and fostersgrowth of Indian industry.


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LIBERALIZATIONOF INDUSTRIAL LICENSING

POLICY

The list of items covered under compulsory licensingunder the Industries Act, 1951 is reviewed on an ongoingbasis.

Drugs and Pharmaceutical have been removed from thelist of items requiring compulsory licensing from 2005

At present, only five industries are under compulsorylicensing mainly on account of environmental, safety andstrategic considerations

8 industries were reserved for the public sector in 1991,at present only 3 industries are reserved.


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INDUSTRIESUNDERCOMPULSORY

LICENSING

Distillation and brewing of alcoholic drinks.

Cigars and cigarettes of tobacco and manufacturedtobacco substitutes.

Industrial explosives including(i) detonating fuses,

(ii) safety fuses,

(iii) gun powder,

(iv) nitrocellulose

(v) matches.


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Electronic Aerospace and defense equipment: all types. Specified Hazardous chemicals i.e.

(i) Hydrocyanic acid and its derivatives,

(ii)Phosgene and its derivatives

(iii) Isocyanates & diisocyanates of hydrocarbon, notelsewhere specified(example Methyl isocyanate)


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INDUSTRIESRESERVEDFORPUBLICSECTOR

Atomic energy.

The substances specified in the schedule to thenotification of the Government of India in the Department

of Atomic Energy number S.O. 212(E), dated the 15thMarch,1995.

Railway transport


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INDUSTRIAL ENTREPRENEURS

MEMORANDUM (IEM)

Industries which are not covered under compulsorylicensing, should file Industrial Entrepreneurs

Memorandum (IEM).

This memorandum is filed with the Secretariat forIndustrial Assistance (SIA).

No industrial approval is required for such exemptedindustries.


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LIBERALIZATIONOFTHE LOCATION POLICY

The Government has been discarding regulatorymeasures, to do away with the location stipulationin setting up of industries in cities with population ofone million and above as per 1991 census

Entrepreneurs are now free to select the locationfor setting up industry.

Zoning and land use regulations as well asenvironmental legislations continue to regulate

industrial locations.


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POLICYFOR SMALL SCALE INDUSTRIES

Review of reserved items is a continuous process.

During the last 5 years ,more than 600 items havebeen dereserved.

At present 21 items are reserved for manufacture inthe small scale sector.

All undertakings other than the SSI undertakings,engaged in the manufacture of items reserved formanufacture in the small scale sector are requiredto obtain an industrial licence


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Undertakings operating under 100% Export OrientedUndertakings Scheme, the Export Processing Zone

(EPZ) or the Special Economic Zone Schemes (SEZs)are not applicable under this policy.

At present, the SSI is defined under the Micro, Small &Medium Enterprises (MSMED)Act, 2006, which hascategorised SSEs as having the value of investment inplant machinery between Rs.2 crore and Rs.5 crore.


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NON-RESIDENT INDIANS SCHEME

The general policy and facilities for Foreign DirectInvestment as available to foreigninvestors/company are fully applicable to NRIs aswell

Government has extended some concessionsspecially for NRIs and overseas corporatebodies(OCB) having more than 60% stake by theNRIs.


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ELECTRONIC HARDWARE TECHNOLOGY PARK/

SOFTWARE TECHNOLOGY PARKSCHEME

The aim of EHTP/STP scheme is to built up strongelectronics industry and enhance export.

Under EHTP/STP scheme, the inputs are allowed to be

procured free of duties. Application for setting up projects under this scheme, are

considered by the Inter-Ministerial Standing Committee(IMSC) Chaired by Secretary(Information Technology).


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POLICYFOR FOREIGN DIRECT INVESTMENT

(FDI)

Promotion of foreign direct investment forms anintegral part of Indias economic policies.

The role of foreign direct investment in acceleratingeconomic growth is by way of infusion of capital,technology and modern management practices.

The Department has put in place a liberal andtransparent foreign investment regime where mostactivities are opened to foreign investment.


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RECENTINITIATIVESTAKENBY FDI

Opening up of sectors such as Insurance (up to 26%);

Development of

Integrated townships (up to 100%);

Defence industry (up to 26%);

Tea plantation (up to 100% subject to divestment of26% within five years to FDI);

Enhancement of FDI limits in private sector banking,allowing FDI up to 100%

Opening up Internet Service Providers (ISPs) withoutGateways and electronic mail and voice mail to 100%foreign investment


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Current Industrial Policies

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