Industries in the Eighth Plan (1992-97)

You are required to remember that the Eighth Plan was framed under a new environment when numerous reforms in industrial, fiscal, trade and foreign investment policies were launched in the economy - commonly termed as economic liberalisation. In the setting of the new Industrial Policy of July 1991, the function of the public and private sector was reviewed. 

In the first phase of planned development the public sector played an innovative role but its principal weakness was its exceedingly poor performance and its inability to produce adequate resources for sustaining the growth process. During this era, the private sector has come of age and has developed substantial entrepreneurial, technological, managerial, financial and marketing strengths. Hence, the private sector should henceforth play a greater function in the process of development. This new method is reliable with the general philosophy of positioning greater reliance on competitiveness of industries and effectiveness of operations. Future growth would, hence, be more in those sectors where the nation has comparative cost advantage.

Eighth Plan assigned a total investment of Rs. 38,083 crore for industry and mineral production (at 1991-92 prices). A review of the progress of actual outlay disclosed that at current prices, Rs. 40,759 crore were spent, but when assessed at 1991-92 prices, this worked out to be Rs. 31,382 crore. In other words, real investment worked out to be about 82% of planned investment. There was, hence, a serious shortfall of the order of 18%.

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