Introduction
Chapter- 1 || 2 || 3 || 4 || 5 || 6 || 7 || 8 || 9 || 10 || 11 || 12 || 13 || 14 || 15 || 16 || 17 || 18 || 19 || 20 || 21 || 22 || 23 || 24 || 25 || 26 || 27 || 28 || 29 || 30 || Conclusion || Appendix

Chapter 19:
PROGRAMME OF INDUSTRIAL DEVELOPMENT

Asessment Of Industrial Progress In The Second Plan

60. Levels of development of capacity and production.— The statement below of some of the principal overall targets in both the.public and the private sectors shows that the second plan will be a period of intensive and many-sided industrial effort.

National targets for some major Industries

PROGRAMME OF INDUSTRIAL DEVELOPMENT

* Represents gross production. Since part of the output is proposed to be Utilised within the works for conversion to other products, quantities available for sale will be 185,000 tons of soda ash and 106,600 tons of caustic soda.
£ 2,50,000 bicycles are expected to be produced in the decentralised sector so that the total production would be 12,50,000.

61. Plant capacities and production costs.—With the high prices for plant and machinery which have prevailed since 1950, it will only be possible to secure reasonably low cost of production in different industries by spreading overheads over a larger output. In other words, plant capacities have to be planned on a larger scale than hitherto. A detailed examination of proposals for different industries shows that the new units proposed to be established in many industries will be large enough to offset higher capitalization costs. The sizes of coke-ovens and blast furnaces in thfi stRfl n1ant< havp ilailv cflnnr.iti'p'i of 1 000 tnr\K andabove. The daily capacity of new sulphuric acid plants will be 25 tons and above—one of the new plants will in fact have a daily capacity of 150 tons—as against 10 ton plants which were common in the past and the maximum capacity of 75 tons per day installed so far. Similarly the Development Council for Heavy Chemicals (Alkalis) has recommended the minimum size of electrolytic caustic soda plants at 20 tons per day. In the case of paper mills a minimum capacity of 25 to 50 tons per day is expected to be the normal feature at the end of the second plan. Cement plants will have normally a minimum capacity of 200,000 tons per annum. In this industry economics in distribution costs are expected to be secured through widespread usage of bulk handling methods wherever possible. For facilitating bulk handling in a larger measure, the railway plan provides for increase in tank wagons and particularly those of special types such as are needed for the transport of chlorine and ammonia.

62. Technological Advances.— Considerable advance is visualised in the introduction of newer techniques in the plants proposed to be established. The new techniques and designs proposed under the steel expansion programmes have been mentioned earlier. The recovery of sulphur from coke-oven gases at the Durgapur Coke-oven plant and of ammonium sulphate and other by-products from coke-oven gas by utilising the waste pickling liquor in place of sulphuric acid at TISCO's works will mark the development of modem techniques in by-product recovery operations. Fermentation techniques will be more widely practised in the production of antibiotics at Pimpri.

63. Transition to Metric System arid Standardization of Processes and products.—Following the decision of the government to switch over to the metric system on the basis of a phased programme, action has been initiated through a Standing Committee under the Ministry of Commerce and Industry. It is expected that, wherever possible, the metric system will be adopted in the new plants to be set up.

In the field of standardization of processes and products, it is envisaged that the work on steel economy initiated in 1954 by the Indian Standards Institution, as part of its programme under the first plan, will be completed, resulting in a measure of rationalisation in the consumption of steel. With the large expansion of domestic production contemplated in the second plan, standardisation will promote greater understanding and confidence between buyers and suppliers of industrial products both within the country and in foreign markets. The second five year plan provides Rs. 60.6 lakhs for the Indian Standards Institution. Success in implementing standards will depend largely on the existence of adequate facilities for testing of products. In the case of capital goods and durable consumer goods, these facilities should provide for the evaluation of performance specifications also. With the expansion of the Government Test House during the second plan, additional facilities are expected to be brought into existence. A proposal to establish a research centre to meet the requirements for testing and development facilities for heavy electrical plant and equipment is also under consideration.

Development Of Raw Materials

64. The consumption of primary mineral and agricultural raw materials in organised industries will increase considerably during the second five year plan. The position as regards minerals which are found within the country is set out in the chapter on Development of Minerals.

As regards some of the imported minerals, like crude petroleum, sulphur and rock phosphate, consumption levels are expected to be as follows:

65. Industrial programmes will also draw substantially upon agricultural raw materials like raw jute, cotton, sugarcane, oil-seeds, timber, bamboos and sabai grass. Additional requirements of timber will arise largely from'production targets envisaged for chemical pulp and newsprint in comparison with which the demands arising from additional production of matches and plywood would be comparatively small. Targets for the production of oils include the utilization of about 300,000 tons of cotton seed and 800,000 tons of oilcakes as against current consumption levels estimated at 100,000 and 60,000 tons respectively. The requirements of bamboo as well as sabai grass arise from the programme for the development of the paper industry and newsprint production. It is difficult to assess the demand for bamboo with precision since there is scope for drawing upon other cellulosic materials like sabai grass, bagasse and certain semi-hard timbers. The extent to which different cellulosic raw materials will be available during the second plan is being examined by a Committee set up by the Ministry of Food and Agriculture. Requirements of raw cotton and sugarcane are estimated to be as follows:

66. Export Targets.—In certain fields production targets have been framed with special reference to the need for increasing foreign exchange earnings and stepping up exports. For the achievement of these targets, standardization of manufactured products, export promotion policies by way of rebate of import duties and establishment of Export Promotion Councils for major industries have already been taken in hand. In the nature of things it is difficult to lay down a rigid and long-term policy in regard to exports and, according to circumstances, appropriate policies and measures have to be devised. The following are the main export targets which have been formulated for achievement by 1960-61.

67. Expansion in Different Sectors.—Progress in basic industries is one of the principal indicators of industrial development. During the first plan, some progress was made in this field through the establishment of the Sindri Fertilizer Factory, the Chittaranjan Locomotive Factory, the Tata Locomotive and Engineering Works, petroleum refineries and textile machinery factories. As a result of the increased emphasis given to industries under the second plan, progress is expected to be much more rapid during the next five years. The economy will be greatly strengthened as iron and steel, machine building and other basic industries are developed. Broadly speaking, the capital and producer goods sector will. register increases during the quinquennium which will be substantially in excess of the investments made so far in these fields. The statement below provides an indication of the pattern of industrial growth which will begin to emerge during the second plan. By the end of the second plan the overall index of industrial production (1951 = 100) is estimated to rise to 194 from 130 in 1955-56. Considering the expansion of production sector-wise, it is anticipated that by 1960-61, the index of production of producer goods which stood at 132 in 1955-56, will rise by about 73 per cent. compared to 18 per cent. increase in the factory produced consumer goods sector which stood in 1955-56 at 128.

68. Regional Development of Industries.— Through successive plans, it will be necessary to try to achieve a considerable measure of balance in industrial development as between different regions in the country. The second plan makes a beginning in this direction. Major projects included in it will open relatively less advanced areas in Orissa and Madhya Pradesh. Measures of long term importance for a wider diffusion of the expansion of industries have been included such as the pilot scheme for the production of pig iron in low-shaft blast furnaces which, if successful, has considerable potentialities for developing the iron and steel industry in relatively small units on the basis of low-grade coals occurring in different parts of the country. Surveys for mineral deposits in new areas are also calculated to achieve the same result. Intensification of research on the use of new materials and processes and development of substitutes in envisaged under the plan in the national laboratories and private institutions. Though the second plan will not provide a solution to the problem of the existing unbalanced growth of industries as between different regions, the problem has been kept in view and, through stress on research, mineral surveys and decentralisation of production, particularly in regard to agricultural processing industries the correct trends of development are being set in motion.

Break-up of anticipated investment in the large-scale industries during 1956-61
(Rs in crores)

*0n certain schemes involving the use of NIDC resources decisions have yet to be taken whether they will be in the public or the private sector.

ANNEXURE I SECOND FIVE YEAR PLAN
(A) Industrial Projects in the Public Sector
(Central Government exclusive a/Schemes of NIDC)

1. The total cost of the project on completion is estimated at about Rs. 68.85 crores.
2. Expected to be in fall production by December, 1960.
3. Expected to be in fall production by the end of 1959.
4. Expected to be in fall production by the end of 1959. The total cost of the project is estimated at Rs. 16.0 crores and the provision the appropriate stage.
5. The total cost of the project on completion is estimated at about Rs. 25 crores.
6. Excludes Rs. 31 lakhs invested by the Mysore Government.

LIST OF ITEMS FOR MANUFACTURE IN THE PROPOSED HEAVY ELECTRICAL EQUIPMENT FACTORY

(B) Industrial Projects in the Public Sector (Major Schemes of State Governments.)

In addition, the State Plans include provision for the establishment of co-operative sugar factories. State Finance Corporations, mineral schemes and for assistance to private industrial schemes. The Plan makes a total provision of Rs. 32 crones for these schemes of which Rs. 23 crores are shown in the State Plans and Rs. 9 crores in the Central Plan.

ANNEXURE II Industrial Development in Private Sector and under the
National Industrial Development Corporation during the Second Plan

1. Includes capacity and production of wagon builders.
2. Production lower on the basis that the additional 10,000 tons capacity at Hirakud or a new 10.000 tons unit will come into production by the middle of 1960 and operate to full capacity for only 6 months in 1960-61.
3. Development of some of the items of heavy machinery envisaged under NIDC.
4. Inclusive of plants in public sector like the sulphuric acid plant of Bihar Superphosphate factory and auxiliary plants in steel vairks and Durgapur Coke Oven Project.
5. Inclusive of the Bihar Government Superphosphate Factory.

PROGRAMME OF INDUSTRIAL DEVELOPMENT