India’s manufacturing sector has taken a long journey from building the country’s industrial foundation to liberalization to the license raj. Now the challenge is to become globally competitive
a Hindustan Motors plant at Uttarpara, 1951; (Right) An automated M&M production line in Chakan, Maharashtra, 2018; (Photo: Getty Images)
sAfter independence in 1947, the domestic manufacturing sector has experienced the formation of the country’s industrial foundation (1950–1960) to the license-permit raj (1965–1980), and from liberalization in the 1990s to the current phase of global competitiveness efforts. The journey has been done. Manufacturing now contributes about 17 percent to India’s GDP and employs about 20 percent of the country’s workforce.
lead essay , Freedom@75 | a new try with luck
The IT and telecom revolution in the late 1980s was followed by liberalization in 1991, when the then PM PV Narasimha Rao and his finance minister Manmohan Singh took several measures to end the license raj. Trade was liberalized and extensive reforms were carried out in the financial sector.
The Atal Bihari Vajpayee regime (1998–2004) was marked by aggressive disinvestment of some state-owned units. The UPA-I government led by Manmohan Singh (2004-09), as supported by the Left, had no room for privatization, but still 5-20 per cent in PSUs through IPOs and secondary issues Sold stake. The Narendra Modi government, through its Atmanirbhar campaign, aims to build domestic capabilities so that Indian companies have an edge in global markets, while easing restrictions to attract more foreign investment.
