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Causes of Industrial Backwardness in India
The Main causes or problems or obstacles of Industrial backwardness or The factors which are responsible for the slow down of industrial development in India are mentioned below –
- Poor Rate of Capital Formation: Poor rate capital formation is consider as one of the major constant which has been responsible for slow down rate of industrial growth in India.
- Lack of Credit Facilities: Credit facilities in India are not easy. The problem is more complicated particularly for the micro and small scale sectors.
- Political Factors: During the periods of pre-independence, industrial Policy followed by British rulers were not at all favourable for the interest of the country. Thus India remained a primary producing country during 200 years of the British rule which ultimately retarded the industrial development of the country in its early period.
- Lack of Industrial Facilities: India is still backward in respect of its infrastructural facilities. Thus in the absence of proper transportation, communication power in many parts of the country, industrial development could not be achieve.
- Lack of trained Workers: In the absence of a good number of technological personnel, there has always been depending on foreign country. As a result, the industrial development is falling several problems.
- Poor Performance of Agriculture Sector: Industrial development is very dependent on the performance of the agricultural sector. Thus poor performance of the agricultural sector resulting from natural factor is also because agriculture sector provides not only raw material and goods but also generates demand for the goods produced by the industrial sector. But the performance of agriculture on our country is very poor.
- Concentration of Wealth: The pattern of industrialization in the country has been resulting in concentration of economic power in the hands of few large industrial houses and thus failed to achieve the objective of planning in reducing concentration of wealth and economic power.
- Poor Performance of the Public Sector: In spite of attaining a substantial expansion during the planning period, the performance of the public sector enterprises remained also along very poor. A good number of such enterprises are incurring losses regularly due to its faulty pricing policy and lack of proper management. Thus it is a constraint for the industrial development of India.
- Regional Imbalance: Concentration of industrial development into some few states has raised another problem of imbalances in industrial development of the country. Western region comprising Maharashtra and Gujarat attained maximum industrial development whereas the plight of the poor states are continuously being neglected in the process of industrialization of the country although a huge investment in the public sector has been made in the backward states but the ‘trickling’ down effects of such investment were not visible.
- Industrial Sickness: Another peculiar problem faced by the industrial sector of the country is its growing sickness due to bad and inefficient management. The patter of industrial development has not been sufficiently guided by cost considerations. Adequate attention has also not been given to improvements in technology and quality of products.
