Large Scale Industries - :: Did Not Rise Up Due To The Apathies Of The Ruling Government



Pic - :: A View Of The Production Floor Of A Large Scale Industry 

Large Scale Industries - :: Did Not Rise Up Due To The Apathies Of The Ruling Government

In a country which should have been the richest  by now in terms of the foreign resources pooled by the collection of the taxes from the industries, and where the p[people should have had a kind of an easy paced life, which we call it or would rightly refer to it as RAM-RAJYA, the industries and the failure to cope up with the times, with the apathies and the  volatility of the Government which had ruled from time to times, the industries in almost sector in India have taken a bed which could be termed as the bed of death.

It is not that the entire blame lies on the Government. Bad management, wrong decisions taken and the pooling of the wrong people beside taking the wrong people in confidence to move ahead had caused the  industries and the factories to go to the bed of death, but the Government’s dictotarial attitude and the interference of the  political entities completely did shatter the industries from the small scale industry to the higher and the bigger one’s.

In this article we shall make an effort to read and discuss all about the large scale industry and by the way, as we move ahead, we ought to discuss and analyse what are the industry in terms of the large scale. Let us know what is the large scale industry ?.

Large scale industries are referred to as those industries that are having huge infrastructure, raw material, high manpower requirements and large capital requirements. Those organisations having a fixed asset of more than 10 crore rupees are considered to be large scale industries. If the present scale of the limit of the large  scale industry as per the discretion of the Government has changed, then  I might not actually know the limit of the same as I have not followed it scrupulously , but this is what the magnitude of the scale is ?.

What is the significance of large scale industries?

 Here are some advantages of large scale industries: 

They provide an impetus to the industrialization of the country. Large scale industries, usually, produce capital and basic goods (instruments, machines, chemicals, etc.) They are capable of generating funds for the research and development of new technologies

What are Large Scale Industries?

Industries which requires huge infrastructure and manpower with an influx of capital assets are Large Scale Industries. In India, large-scale industries are the ones with a fixed asset of more than one hundred million rupees or Rs. 10 crores.

The Indian economy relies heavily on such industries for economic growth, generation of foreign currency, and the creation of job opportunities for millions of Indians. It is a truth that the industries in India which falls under the scales from the small to the large,  this and these industries always are the supply zones of the employments and that actually serves the greatest importance of these kind of industries, and the small scale industry from 1954-55 to about 1977-78 always stood first to , first,  create the maximum number of jobs and secondly to generate the influx of the highest tax that could be paid in India.

Here are some advantages of large scale industries:


Pic - : A View Of The Large Scale Industry 

·         They provide an impetus to the industrialization of the country.

·         Large scale industries, usually, produce capital and basic goods (instruments, machines, chemicals, etc.)

·         They are capable of generating funds for the research and development of new technologies.

·         Due to the large scale of operations, they have the potential to lower the cost of goods.

·         Further, they create opportunities for small-scale and cottage industries to evolve and flourish.

·         Also, the employment opportunities created by large scale industries are huge.

Large Scale Industries in India

The term ‘ large-scale ’ is generic in nature and includes different types of industries. In India, the following heavy industries fall under the purview of large scale industries:

·         Iron and Steel Industry

·         Textile Industry

·         Automobile Manufacturing Industry

·         Over the last two decades, Information and Technology (IT) industry has evolved and has contributed huge revenues while creating thousands of jobs for Indians. Hence, many economists include it in the large-scale industry sector.

·         Telecom Industry

It is important to note that these industries are either manufacturing units or those which use both indigenous and imported technologies.

Here are some more examples:

Fertilizer , Cement , Natural gas , Coal , Metal extraction , Metal processing , Petroleum , Mining , Electrical , Petrochemical , Food processing units , Tourism , Banking , Sugar , Construction , Automobile , Communication equipment , Cement , Chemicals , Earth movers , Consumer durables (like television, refrigerators, etc.) , Engineering products , Vehicle assembly , Beverages , Agricultural processing , Insurance and Finance.

In recent years, as the markets opened up due to globalization, there has been a mixed effect on large-scale industries. There are some who have managed to attract international customers, foreign trade and technology, tie-ups. However, there are also others who were unable to cope with the competitiveness ushered in by the open market.

What is large scale industrial production?

 It is imperative and it is very essential to first analyse the difference and the calculations that we engage ourself in the matter of the industries , which could be construed  as the point of differentiation of the production of the small scale industry and the large scale industry.

A small sacle industry can manufacture and produce very much as compared to the large scale industry but it cannot become a large scale industry.It is because of the paid-up capital first that comes into the  picture when one talks about the industries, and then the definition in terms of the scales that the Government of India has used it to define the industries. It is imperative to define the large scale production In the matter of differentiation,  and characterization, it is imperative to  first differentiate the large scale industry and then to characterize it for the sake of benevolence and mechanized , which is mechanism while and when we talk about  comparism.

The term, “ Large scale production ” refers to the production of a commodity on a large scale with a large sized firm. It requires huge investments in plant and machinery. Large scale production can be carried out if the market size is large and expanding. ... They cater to a large market

Large scale firms are characterized by mechanization, division of labor and production and sale of goods in large quantities. They cater to a large market. The industrial revolution laid the foundation of the factory system. The factory system which extensively used machinery and adopted division of labor made large scale production possible.

China is today considered to be the factory of the world because of its focus on large scale production. It today accounts for 50% of the world’s production of cameras, 30% of air-conditioners, 25% of washing machines and 20% ofrefrigerators. It has become the world’s largest producer of toys, mobile phones, DVD players, laptop computers and colour TV sets.

What are the Motives for large scale production?

 The following are some of the motives of large scale production.

1.      Desire for economy.

2.      Desire for increase in sales.

3.      Desire for a large customer base.

4.      Desire for large profits.

5.      Desire to become a global company.

6.      Desire for economic power.

7.      Desire for continuous growth and expansion.

8.      Desire to increase demand.

9.      Desire to overcome competition.

10.  Desire to achieve monopoly status.

11.  Desire for achieving long term profitability.


The Reasons For The Failure Of The Large Scale Industries Of India- ::

Foregoing analysis shows that India has made sufficient achievement in industrial development during the last five decades and has emerged as the tenth largest industrialized country of the world. But considering the size of the country this development is far from satisfactory.

There are some reasons that could be attributed to the same  and as we study them is details, we could as well as describe them in short and analyse the factors of the same. There could be many as though but some of the most important one’s are as follow-:

There are many areas where despite requisite facilities industrial development is either insufficient or completely absent. The pace of industrial progress has been very slow and the growth has always lagged behind the target (except in 7th Five Year Plan). Despite industrial progress self- sufficiency is a distant dream and import substitu­tion a major problem. Under utilization of existing capacity is another major problem which is due to lack of power, raw material and demand. These are some that could be linked to the Governmental apathies that is related to the cause of the underdevelopment and there could be even more that is self that has destructed the economy of the large scale industries and finally this sector either as a whole or as an independent entity.

The Elite Oriented pattern-:  

Industry has developed  the elite oriented pattern. Concentration of economic power in the hands of few, regional imbalances, sickness of industries, loss in public sector industries, unsatisfactory labour relations, lack of capital and industrial raw materials, chang­ing policy of the government, and defective licens­ing policy are some of the problems which are hindering the overall industrial development in the country. In following paragraphs an attempt has been made to highlight some of these problems.

1. Unbalanced Industrial Structure

Despite all efforts India has not been able to attain self sufficiency in respect of industrial mate­rial. India is still dependent on foreign imports for transport equipments, machineries (electrical and non-electrical), iron and steel, paper, chemicals and fertilisers, plastic material etc. In the total industrial production consumer goods contribute 38 per cent. In newly industrialised countries like Singapore, South Korea and Malaysia this percentage is 52, 29 and 28 respectively. This shows that import substi­tution is still a distant goal for the country.

2. Low Demand

There is low demand for industrial products in the country due to low consumption level, weak purchasing power and poor standard of living. The domestic market is chronically underdeveloped through lack of enthusiasm generated by the middle and upper class segment who do not wish to raise their standard and improve their living conditions.

3. Regional Concentration

In India most of the industries are located in few selected areas leaving out vast expanse of the country devoid of industrial establishments. Most of the industries are located in and around metropolitan cities like Mumbai, Kolkata, Delhi etc.   At present  there is an uneven concentration of indus­tries. While the states like Maharashtra, Gujarat, Tamil Nadu etc are well ahead in industrial develop­ment others like Meghalaya, Manipur, Jammu and Kashmir, Himachal Pradesh, Tripura, Orissa, As­sam etc are far behind. This has not only created regional imbalance and regional disparity but has encouraged fissiparous tendency including unrest, violence and terrorism.

4. Loss in Public Sector Industries

Owing to focus on socialistic pattern of de­velopment investment under public sector industries increased phenomenally during early five year plans. But due to defective policy of the government char­acterised by redtops and inefficiency and strained labour-management relations most of these public sector enterprises are running in loss. Every year the government has to incur huge expenditure to cover up this loss and meet obligations of paying wages to the employees.

This hardly leaves surplus money to go for new industrial ventures and launch schemes for social development. To avoid this burden on exchequer the government is promoting privatisa­tion and disinvestment of shares of public sector undertakings. This goes against the Peruvian model of development initiated during the fifties of the last century.

5. Industrial Sickness

In the private industrial sector a growing number of industrial units are becoming sick. Wide­spread sickness has, indeed, become a major prob­lem of this sector. The causal factors for this sickness are: 

(i) deficient management, (ii) under-utilisation of capacity due to shortage of raw materials, coal and power and transport, (iii) obsolete machinery, equip­ment and production techniques, (iv) uneconomical scale of production, (v) faulty choice of products and processes, (vi) difficulties in selling the products, (vii) diversion of funds to new units under same ownership, and (viii) conflict between different in­terest groups among the owners. As at the end of March 1999 there were 3, 09,013 sick/weak units (3, 06,221 in SSI and 2,792 in non-SSI sectors). A total of Rs. 19,464 crores of bank credit was locked up in these sick units. Sometimes, the government takes over sick units which further worsen the prob­lem.

In order to provide a focal point for the revival of sick units, the Industrial Reconstruction Corpora­tion, and the Board Of Industrial Financial Reconstruction ( B.I.F.R)  was reconstituted in 1985 as the Industrial Reconstruction Bank. It is now the principal agency for reconstruction and rehabilitation of sick units.

The Central Government set up in 1986 two Funds, the Textile Modernisation Fund (TMF) and the Jute Modernisation Fund (JMF) to provide assistance on concessional terms to healthy as well as sick units for modernisation. These two Funds are being administered by the IDBI and the IFCI respectively. There is also a need for constant monitoring and deterrent penalties to the parties responsible for sickness.

6. Lack of Infrastructure

An inadequate infrastructural facility is another major problem faced by the Indian industries. En­ergy crisis has a great bearing on the industrial development and production. Although the installed capacity of electricity increased from 66.08 million km in 1990-91 to 85.79 million km in 1996-97 but it is much short of the actual demand.

It leads to power cut and rostering which hampers the industrial pro­duction. Most of the State Electricity Boards are running in loss and are in deplorable condition. Rail transport is overburdened while road transport is plagued with many problems. Even national highways in many places are in bad shape. Telecom­munication facilities are mainly confined to big cities.

That is it……

That sums up it and that is all .....

Regards and THANKS

Pics



Shyamal Bhattacharjee 

Mr Shyamal Bhattacharjee, the author was born at West Chirimiri Colliery at District Surguja, Chattisgarh on July 6th 1959 He received his early education at Carmel Convent School Bishrampur and later at Christ Church Boys' Higher Secondary School at Jabalpur. He later joined Hislop College at Nagpur and completed his graduation in Science and he also added a degree in    B A thereafter. He joined the HITAVADA, a leading dailies of Central India at Nagpur as a      Sub-Editor ( Sports ) but gave up to complete his MBA in 1984 He thereafter added a Diploma In Export Management. He has authored THREE books namely Notable Quotes and Noble Thought published by Pustak Mahal in 2001 Indian Cricket : Faces That Changed It  published by Manas Publications in 2009 and Essential Of Office Management published by NBCA, Kolkatta  in 2012. He has a experience of about 35 years in Marketing .


 

 


 


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