One of the pillars of the 1956 Industrial Policy was to check concentration of economic power in few individuals, groups or business houses. To what extent this policy was able to achieve this? Examine.
Industrial licensing policy was laid down under industrial development and regulation act 1951. The act made it mandatory for the central government’s permission for establishing a new industry and extension of old industry. Since establishing of industries required huge capital; the policy favored only big business houses who were in better position to raise huge amount of capital. Thus, it downtrodden the small scale and micro industries and merchants. Also, since there was no provision for revoking of licenses; many of the issued licenses were never utilized thus; preventing entry of other businessmen and curbing the growth of industries.
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