IS 4 Minor II

8/3/2019 IS 4 Minor II

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Industry word derived from Latin word industriawhich means dexterity & resourcefulness

Any type of Economic Activity producing GOODs

or SERVICES It is part of a chain from raw materials to

finished product, finished product to servicesector, and service sector to research and

development. It includes AGRICULTURE, MANUFACTURING andSERVICEs

Industry varies over time and between differentcountries

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When one Industry depends on theoutput of another

This can cause problems if one industry

has production problems or closes down The CAR INDUSTRY is a good example

each component (engine parts, lights,body etc) may be produced by a differentcompany before it goes to the ASSEMBLYPLANT



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There are four types of Industry: - Primary - Secondary - Tertiary - Quaternary



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This involves RAW MATERIALS or NATURALRESOURCES (before PROCESSING)

Raw Materials can be:

- Quarried - Mined (all below the earths surface) - Drilled for ( INCLUDING: Coal Mining, Oil Drilling,

Gold Mining)

- Grown Collected(INCLUDING: Farming andForestry - INCLUDING: Fishing)



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This involves a PRODUCT from Primary Industry which isPROCESSED or MANUFACTURED into another product

Processing of Raw Materials (where raw materials arechanged into something different)

- Oil refined to make Petrol - Fish is processed to makeFish Fingers!

- Wheat ground to make Flour - Trees are sawn to makeTimber

Manufacturing of Raw Materials (different partsassembled to make a finished product)

- Steel Making - Making Ships/Cars/Televisions - Building Roads and Houses (the FINISHED PRODUCT from one Secondary Industry

may be the Raw Material from another e.g. One factorymay make tyres



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This provides a SERVICE It involves a wide range of services

INSTEAD of making anything and is the

LARGEST group of industries Examples of so-called Service Industries - Teaching - Nursing - Retail

- Civil Service - Police Force - Transport



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This involves a small group of RESEARCH andDEVELOPMENT industries

It is the newest industrial sector (often linked withTertiary) and is growing rapidly due to developments

in INFORMATION TECHNOLOGY and COMMUNICATION It focuses on the LATEST TECHNOLOGY Examples of Quatenary Industries - Designing new computers/writing computer software - Researching new medicines and medical equipment - Genetically modifying plants and animals for farming - New forms of communication through satellites and

fibre optics



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PRIMARY FACTORS: SECON:DARY FACTORS

RAW MATERIALS*distance from raw materials

affects transport costs - LABOUR*

employees with differentskills

are needed - TRANSPORT*

road, rail, sea and airnetworks

are needed for the importand

export of goods - MARKET*

access to people who will

purchase the goods orservices

Energy*

proximity to supplies of electricity (or coal/waterin the past) to power the industry

Site*

modern factories require large areas of flat

land (esp. for assembly lines) - Communications*

reliable telecommunications are increasinglyimportant

- Capital*

money needed to up the industry - Government Policy*

industry is restricted/encouraged in certain

areas by the use of grants, low taxes, rentallowances

- Environment*

attractive surroundings with good leisure facilitiescan be important to a workforce

- Other*

sometimes (as not all bosses are rational)

industries areestablished in places that someone just thinks is05/04/12 8By Devesh Sharma


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Factory system has INPUTS, PROCESSES andOUTPUTS

INPUTS all the items that go into making theproduct

anything needed before the production process cantake place

PROCESSES are factory activities that transformraw materials into the finished product

everything needed to make the product OUTPUTS are what comes out of the factory after

the production process Some OUTPUTS are fedback into the system as inputs:

e.g. PROFIT will be put back in as investment capital



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Inputs ProcessOutputs

Dyes Dyeing, Cutting Shirt

Thread Sewing, Packaging SecondGarments

Power Supplies Administration Clothes

Machinery Factor maintenance Profit

Capital

Profits



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Definition: Industrialization is a historical phaseand experience. Industrialization is the overallchange in circumstances accompanying a society'smovement population and resources from farmproduction to manufacturing production andassociated services.

By S. Haward Patterson Industrial revolution may

be defined as changes in methods of productionbrought about by the invention of power machinery& the consequent development of factory system



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1.Ancient Period 2.Medieval Period 3.Morden Period

1. Ancient Period:-

Food & Protection were main concern

Bow, Arrow & Wooden Stick (Hunting & Safety)

Making fire by rubbing two stones

Discovery of wheel

Note :Urbanization was the main cause of new system camein vogue



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Again It is divided into three industrialsystem

1 :-Feudal System 2:-Guild System 3:-DomesticSystem

1 :-Feudal System The Primary industry wasAgriculture in this era. It was operated by feudal lord & serfs.Serfs were virtual slaves & dependent upon feudal lords .

Fabrication Manually Operated Machines Stocking & Exchange of Goods

Small Industries by Carpenters, Blacksmiths &05/04/12 13By Devesh Sharma


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Merchant Guild:- In this System personswere engaged to look after the interest ofbusinessmen

Crafts Guild:- They were worked forpromotion & protection of craftsmen

Note@@ (Lack of functionality & responsibilities of Officialsas internal factor. Hold of capitalists on production sector& arbitrarily used their own selfish ends as externalfactor) were the reasons of decline of guilds



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Money lenders (sohukaars) weremain source of finance whichprovided money with interest

Barber ,Shoemakers, Washer men&Women Cooks were the main jobsthat time

Domestic goods ( Corase cloth,baskets & earthenware etc)



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In Modern System Industry is movingfrom human/animal power to machinepower.

Factory System Heavy Industry Availability Of Primary Factors



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Industrial policy is a statement to define therole of government to protect & develop theindustry.

It covers rules, regulations, principles, policies,& procedures laid down by government for

regulating & controlling industrialundertakings in the country.

It prescribes the respective roles of the public,private, joint, cooperative large, medium &

small scale sectors for the development ofindustries

It incorporates fiscal & monetary policies, tariff

policy, labor policy.05/04/12 17By Devesh Sharma


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To achieve optimal utilization of human

resources To attain international competitiveness

and To transform India into a major partner

and player in the global arena

In other Words :-

1.Rapid Industrial Development2.Balanced Industrial Growth

3. Balance Industrial Structure05/04/12 18By Devesh Sharma


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Industrial Policy Resolution of1948

Industrial Policy Resolution of1956 Industrial Policy Resolution of

1973 Industrial Policy Resolution of

1977

Industrial Policy Resolution of05/04/12 19By Devesh Sharma


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Industrial Policy Resolution 1948 Priority to promote rural and traditional industries in sectors,

such as: Handlooms, Handicrafts, Sericulture, Coir and Khadi

and village industries Constitution of Statutory Boards / Commissions for the same

Industrial Policy Resolution 1956 Policy Framework for SSI sector Constitution of Independent Board for Small Scale Industries Policy on Credit, Marketing, Technical Assistance, Industrial

Infrastructure and Extension Services.

Policy Focus Priority to mitigate regional imbalances 1977 Measures to promote ancilarisation 1988 Stress on Exports and dispersal of enterprises in rural areas

year 1990 Priority for Small tiny agro industries 199105/04/12 By Devesh Sharma


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It came in forced in April 1956 classified theindustry into three categories

Schedule A:- Carrying 17 industries

Schedule B:- Carrying 12 Industries

Schedule C:- Remaining industries

The Constitution of India, in its preamble, has declared that it aims at

securing for all its citizens: JUSTICE, Social, economic and political; LIBERTY of thought, expression, belief, faith and worship; QUALITY of status and opportunity; and to promote among them all; FRATERNITY assuring the dignity of the individual and the unity of the

Nation.In its Directive Principles of State Policy, it is stated that-

The State shall strive to promote the welfare of the people bysecuring and protecting as effectively as it may a social order inwhich justice, social economic and political, shall inform all theinstitutions of the national life.



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There were 17 industries listed in Schedule A 1. Arms and ammunition and allied items of defence equipment. 2. Atomic energy. 3. Iron and Steel. 4. Heavy castings and forgings of iron and steel. 5. Heavy plant and machinery required for iron and steel production, for mining, for

machine tool

manufacture and for such other basic industries as may be specified by the CentralGovernment. 6. Heavy electrical plant including large hydraulic and steam turbines. 7. Coal and lignite. 8. Mineral oils. 9. Mining of iron ore, manganese ore, chrome-ore, gypsum, sulphur, gold and diamond. 10. Mining and processing of copper, lead, zinc, tin, molybdenum and wolfram. 11. Minerals specified in the Schedule to the Atomic Energy (Control of Production and

Use) Order, 1953. 12. Aircraft. 13. Air transport. 14. Railway Transport.

15. Ship Building. 16. Telephones and telephone cables, telegraph and wireless apparatus (excluding05/04/12 22By Devesh Sharma


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All other Minerals except minorminerals

Aluminum & other non ferrousmetals

Machine Tools Ferror alloys & tool steel Chemical industries (Drugs,

dyestuffs & Plastic Antibiotic & other essential drugs Fertilizers Synthetic Rubber Carbonization of Coal Chemical Pulp Road Transport Sea Tranport

All otherremainingindustries `



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Policy focus is on Deregulating Indian industry;

Allowing the industry freedom and flexibility inresponding to market forces and

Providing a policy regime that facilitates and fosters

growth of Indian industry. In pursuit of the industrial objectives,

Government decided to take a series of initiativesin respect of the policies relating to the followingareas:

Industrial LicensingForeign Investment

Foreign Technology Agreements

Public Sector Policy

MRTP Act05/04/12 24By Devesh Sharma


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The Industrial Policy Resolution of 1956

identified the following three categoriesof industries: Those that would be reserved for development in public

sector.

Those that would be permitted for developmentthrough private enterprise with or without Stateparticipation.

Those in which investment initiatives would ordinarily

emanate from private entrepreneurs. Industrial Licensing is governed by the Industries

(Development & Regulation) Act, 1951. Industrial licensing was abolished for all industries,

except those specified (18 industries), irrespective oflevels of investment



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Limit on foreign equity holdings raisedfrom 40% to 51% in a wide range ofindustries

Foreign Equity Proposals need not to be

accompanied by Foreign TechnologyTransfer Agreement

Procedure for FDI streamlined by creatinga Foreign Investment Promotion Board toconsider individual application case bycase



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Foreign technology agreements in high-priority industries upto Rs. 1 crore weregiven automatic permission.

No permission was required for hiringforeign technicians and foreign testing ofindigenously developed technologies.



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List of industries reserved for the public(Schedule A) reduced from 17 to 8

List of sector reserved for dominance by

public sector (Schedule B) effectivelyabolished

Disinvestment in selected public sectorenterprise to raise finance for development,bring in greater accountability & help createa new culture in their working for improvedefficiency



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Removed the threshold limits of assets in respect of

MRTP companies and dominant undertakings Eliminated the requirement of prior approval of Central

Government for Establishment of new undertakings Expansion of undertakings Merger, Amalgamation and Takeover Appointment of Directors under certain circumstances.

The newly empowered MRTP Commission will beauthorised to initiative investigations on complaintsreceived from individual consumers or classes ofconsumers in regard to monopolistic, restrictive andunfair trade practices.

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IS 4 Minor II

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