Multiple Choice Questions on With reference to the Industrial Policy Resolution 1956 of India consider the following statements 1........... for UPSC Civil Services Examination (General Studies) Preparation

Industrial Policy and Industrial Growth

Economic Affairs

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Indian Economy - Understanding the basics of Indian economic system

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    With reference to the Industrial Policy Resolution 1956, of India, consider the following statements:

    1. This resolution formed the basis of the Second Five-Year Plan.

    2. The purpose of this policy was to promote regional equality.

    3. No new industry was allowed to be set up without a license from the government.

    How many of the statements given above are correct?

    Only one 

    Incorrect Answer

    Only two 

    Incorrect Answer

    All three

    Correct Answer

    None 

    Incorrect Answer
    Explanation:

    Industrial Policy Resolution 1956 (IPR 1956): In accordance with the goal of the state controlling the commanding heights of the economy, the Industrial Policy Resolution of 1956 was adopted. Statement 1 is correct: This resolution formed the basis of the Second Five Year Plan, the plan which tried to build the basis for a socialist pattern of society. This resolution classified industries into three categories. • Exclusively owned by the government • Industries in which the private sector could supplement the efforts of the public sector, with the government taking the sole responsibility for starting new units • Remaining industries which were to be in the private sector. Statement 2 is correct: This policy was used to promote industry in backward regions. The purpose of this policy was to promote regional equality. Statement 3 is correct: Although there was a category of industries left to the private sector, the sector was kept under state control through a system of licenses. No new industry was allowed unless a license was obtained from the government. 


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