Industrial Policies & Regulations

Industrial policy can be defined as an acknowledgment stating the role of government in industrial development, the position of public and private areas in the industrialization of the country, and the comparative role of large and small industries.

In abbreviated, it is a proclamation of objectives to be acquired in the fields of industrial development and the steps to be taken for achieving these objectives. So, the industrial policy formally represents the globe of activity of the public and private sectors.

Industrial Policies & Regulations


It enlists the procedures and rules that will monitor the growth and pattern of industrial activity. This industrial policy is neither fixed nor flexible. It is arrangement, modified, and further modification is done gospel to the changing situations, requirements, and perspectives of developments.

The major objectives of industrial policy are discussed below.

Rapid Industrial Development

The rapid industrial development industrial policy of the Government of India focuses on increasing the level of industrial development. It analyzes ways to construct a favorable investment environment for the private area and also for mobilizing resources for investment in public ae. In this way, the government roots to promote rapid active industrial growth in the country.

Balanced industrial Structure

The Balance industrial Structure policy is crafted to correct the prevailing downgraded industrial structure.  for example, India had some fairly developed consumer products industries before independence but the capital goods area was not at all developed, also basic and heavy industries were by and large absent.

Prevention of Concentration of Economic Power

The prevention of concentration of economic power is industrial policy explores to facilitate a restriction of rules, regulations, and reservation of spheres of activities for the public and private sectors. This is targeted at minimizing the dominating symptoms and avoiding the focus of economic power in the hands of a few big industrial houses.

Balanced Regional Growth

The Balanced Regional Growth industrial policy also targets actual differences between regions in industrial development. It is a well-known fact that some regions in our country are absolutely developed industrially, like   Gujarat and Maharashtra, while others are marked as industrially backward regions, like Orissa and Bihar. It is the job of industrial policy to alter some programs and policies, which will result in the development of industries or industrial growth.

Introduction of Industrial Entrepreneurs' Memorandum (IEM)

Companies that don’t depend upon necessary licensing are that expected to file an Industrial Entrepreneurs' Memorandum (IEM) to the Secretariat for Industrial Assistance (SIA). Industrial validation is not needed for these types of exempted industries. Amendments are also allowed to IEM angle filed after 1.7.1998.

Policy for Small-Scale Industries

The provision of goods that are accomplished exclusively for small-scale industries ensures effective measures for protecting this area. Since 24th December 1999, entrepreneurial undertakings with a maximal investment of up to rupees one crore are within the small scale and ancillary area.

EHTP vs STP Scheme

For an established strong electronics company ahead with a view to customize export, two schemes viz. Electronic Hardware Technology Park (EHTP) and Software Technology Park (STP) are in operation. Under EHTP/STP scheme, the inputs can be generated free of duties.

Policy for Foreign Direct Investment (FDI)

The promotion of FDI forms an essential part of India's economic policies. The role of FDI in developing economic growth is by way of infusion of assets, technology, and modern management activities. The Department has put in place a liberal and transparent alien investment regime where all the practices are opened to strange investment on automatic routes without any limit on the expansion of overseas ownership.

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