Impact on Industries

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IMPACT ON INDUSTRIES

BYL.NAGAMMA(118909)LENIN BALAJI(118910)


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Lack of International Trade in India Growth emphasized only in Agriculture

Sector

The pattern of Industrialization effect onIndustries

INTRODUCTION


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Country Percapitaincome$(1994)

Agriculture (%)

Industry(%)

Services(%)

USA 25880 2 31 67

CANADA 19510 3 30 67BELGIUM 22870 2 31 67

UK 18340 2 32 66

JAPAN 34630 2 40 58

CHINA 530 21 47 32

INDIA 320 30 28 42

ROLE OFINDUSTRIALIZATION


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Three stages during 19th century:a. Processing of primary products.

b. Transformation of materials.

c. Manufacturing machines.

INDUSTRIALIZATIONPATTERN


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Main features:1. Lop- sided pattern of industry:

Employees(1956) - 15million in manufacturingsector.

3.9 million employees in factories.- 31% in small factories.

- 26% in medium.

-43% in large factories. 11.1 million in house hold enterprises

Rest in work shops

INDUSTRIAL PATTERN ONTHE EVE OF

PLANNING(1950)


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2. Low capital intensitya. Low wages.

b. low per capita income on workers.

Capital per worker employed in someindustries:

Contd

Industry

(1960)

USA in

thousands ofdollars

India in

thousands ofdollars

Cotton 8.7 1.8

Iron & Steel 32.1 5.7

Sugar refinery26.8

2.6


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3.Composition of manufacturing output:Structural imbalances industrial Patten.Imbalances in domestic supply and

domestic demand.


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First five -year plan andindustries(1951-56):

a. Providing basic services.

Investmet-800 crores out of which 94 cr topublic sector . Investment on new projects- 57 cr. Modernization and replacement-340 cr.

Increase in industrial production-39%. Annual growth rate-7%.

INDUSTRIAL PATTERN&FIVE -YEAR PLANS


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Second five-year plan in industries(1956-61):

This plan was based on industrial policy resolution 1956envisaged a big expansion of public sector.

Investment- 840 cr public sector industries.

670 cr-private sector industries.

265-village & small scale industries.

Increase production in iron and steel, expansion ofcapacity.

Removal of gap between capacity and production.

Increase in production to 50%


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Third five-year plan (1961-66): Concentrated on agriculture. Investment- 3000 cr 1700 private sector,

1300 public sector. Increase in production-70%. Industrial growth rate -7.6%.


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Fourth five-year plan(1969-74): Objectives: Completion of investment.

Increase in existing capacity. Internal development of availabilities.Total Investment- 3050 cr public sector. Industrial avg growth rate-5%.

Targeted growth rate is 5%.


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Fifth five-year plan(1974-78): Objectives: rapid growth of core sector

industries. Development of industries. Enlargement of production of industries. Development of small industries. Removal of Restrictions on private sector,

monopolistic undertakings and foreignconcerns seeking investment in india.

Annual industrial growth rate -5.3


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sixth five-year plan(1980-85): Objectives: Structural diversification , modernization

and self reliance.Targetted growth rate achieved .


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seventh five-year plan(1985-90): Objectives: Rapid removal of infrastructural constraints.

Encouragement of modernization andtechnology up gradation. Specific targets of the productivity. Encouragement of sunrise industries.

Removal of regional disparities. Annual growth rate- 8.5


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Eighth five-year plan(1992-97): Concentrated on economic liberalization. Modification in industrial trade, fiscal

policies. Growth rate-8.1


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Ninth five-year plan(1997 2002):The main objectives of the Ninth Five Year Plan India are: to prioritize agricultural sector and emphasize on the rural

development

to generate adequate employment opportunities andpromote poverty reduction

to stabilize the prices in order to accelerate the growthrate of the economy

During the Ninth Plan period, the growth rate was

5.35 per cent, a percentage point lower than the targetGDP growth of 6.5 per cent.


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Tenth five year plan(2000-2007): Reduction of poverty ratio by 5 percentage points by

2007; Providing gainful and high-quality employment at least to

the addition to the labour force All children in India in school by 2003; all children to

complete 5 years of schooling by 2007 Reduction in gender gaps in literacy and wage rates by at

least 50% by 2007 Increase in Literacy Rates to 75 per cent within the Tenth

Plan period (2002 to 2007) Reduction in the decadal rate of population growth

between 2001 and 2011 to 16.2%


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1. Income & Povertyv Accelerate GDP growth from 8% to 10% and then maintain

at 10% in the 12th Plan in order to double per capita incomeby 2016-17

v Increase agricultural GDP growth rate to 4% per year toensure a broader spread of benefits

v Create 70 million new work opportunities.v Reduce educated unemployment to below 5%.v Raise real wage rate of unskilled workers by 20 percent.v

Reduce the headcount ratio of consumption poverty by 10percentage points.

Eleventh plan (2007-2012)


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Global GDP Growth 2% In 2003, 2002 And 2001While 4% In 2000 And 1999

Economic Growth further accelerated during thisperiod and crosses over 8% by 2006.

World Trade Growth Has Slowed

Every country wants to improve Global Trade

o a za on an sImpact on Indian

Industry


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IMPACT OF REFORMS ININDIA

Positive :Easy availability of imported/foreign collaboratedlocally produced consumer items plus consumerdurables.

Reliable communication system of telephone(landline and mobile), e-mailAvailability of large number of qualified youth in

most disciplines

State governments trying to attractinvestment byoffering incentives / benefits


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Economic Growth Of 7%

MNCs have entered The Market both ForSourcing as Well as Selling their Product

Well Established And Developed Stock ExchangeGrowth In Automobile, IT, Construction, Pharma,

Telecom, Energy, Entertainment And Service

Sectors


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IMPACT OF REFORMS

Negative :Presently no change in existing labour

laws

Manufacturing companies haveRestructured and downsized(engineering, metals, cement, electricalmachinery, textiles)

Lot of companies offered voluntaryretirement schemes (vrs) and reducedthe number of employees.


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Shortage of power continues in spite of

investment in powerQualified persons are prepared to work

at lower level jobs


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BooksIndian economy by Ruddar Dutt.

1.SME Report on Industries

http://www.aima-ind.org/research/SME_Report_

2.Impact of Technology ESIME

http://amesp02.tamu.edu/~sanchez/IMP%20OF

3.Global Competitive Business

http://www.gmupolicy.net/india/GlobalCompetit

4.AIMS Presentation

References
http://www.aima-ind.org/research/SME_Report_Executive_Summary.ppthttp://amesp02.tamu.edu/~sanchez/IMP%20OF%20TECHNOLOGY%20ESIME-April%2007l%20.ppthttp://www.gmupolicy.net/india/GlobalCompetitiveBusiness.ppthttp://www.gmupolicy.net/india/GlobalCompetitiveBusiness.ppthttp://amesp02.tamu.edu/~sanchez/IMP%20OF%20TECHNOLOGY%20ESIME-April%2007l%20.ppthttp://www.aima-ind.org/research/SME_Report_Executive_Summary.ppt


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Thank YOU

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Impact on Industries