Chapter Overview

Industrial policy (औद्योगिक नीति) decides who builds India’s factories, under what rules, and with what support. India moved from a State-led, licensed model (1948–1991) to a liberalised, market-led one after 1991, and since 2014 to an active manufacturing push (Make in India, PLI). Along the way the public sector was partly sold off, and the small-industry policy shifted from protection to competitiveness.

Chhattisgarh sits at the heart of this story: Bhilai was a child of the 1956 policy, BALCO at Korba was one of the first and most controversial strategic sales, NMDC Steel at Nagarnar is a live disinvestment case, and the state is a major producer of the core industries the nation measures every month.

What You’ll Learn

By the end of this chapter, you will be able to:

State the features of IPR 1948, IDRA 1951, IPR 1956 (Schedules A, B, C) and the 1970s policy statements
List what the New Industrial Policy of 1991 changed, and what remains reserved or licensed today
Explain Maharatna, Navratna and Miniratna criteria and the history of disinvestment up to DIPAM and the 2021 PSE policy
Classify an enterprise as micro, small or medium under the limits in force from 1 April 2025, and match MSME schemes to their features
Explain Make in India, the PLI schemes, industrial corridors and the National Manufacturing Mission
Use the new 2022-23 series of the IIP and the Index of Core Industries (now nine core industries)
Write balanced Mains answers on disinvestment, MSMEs and manufacturing, with a Chhattisgarh angle

Prerequisites

Basic Concepts of the Economy: sectors of the economy, GDP and GVA
Planning in India: Five Year Plans and the 1991 economic reforms

Learning Path

Follow the topics in this order:

graph TD
    A["1. Industrial Policies
IPR 1948, IDRA 1951, IPR 1956,
MRTP, NIP 1991"] --> B["2. Public Sector and Disinvestment
Ratna status, DIPAM,
BALCO, PSE Policy 2021"]
    B --> C["3. MSMEs
MSMED Act, 2025 limits,
Udyam, MUDRA, PM Vishwakarma"]
    C --> D["4. Make in India
PLI, corridors, NMM,
IIP and core industries"]
    D --> E["5. Quick Revision
One-page sheet"]
    E --> F["Next chapter:
Money and Banking"]

Topics in This Chapter

#	Topic	What it covers
1	Industrial Policies of India (1948–1991)	IPR 1948 and its four categories, IDRA 1951, IPR 1956 schedules, licence raj, MRTP and FERA, 1973/1977/1980 statements, NIP 1991, today’s 2 reserved and 5 licensed industries
2	Public Sector and Disinvestment	CPSEs, DPE, Maharatna-Navratna-Miniratna criteria, disinvestment methods and timeline, DIPAM, BALCO, Air India, New PSE Policy 2021, NMDC Steel Nagarnar
3	MSMEs: Definition, Institutions and Schemes	MSMED Act 2006, 2006/2020/2025 classifications, Udyam, MSME share in GVA and exports, SIDBI, CGTMSE, PMEGP, MUDRA, Stand-Up India, PM Vishwakarma, delayed payments, problems
4	Make in India and Manufacturing Policy	NMP 2011, Make in India, ease of doing business, Atmanirbhar Bharat, PLI (14 sectors), semiconductors, corridors, National Manufacturing Mission, IIP and ICI (base 2022-23)
—	Quick Revision	Every policy, date, threshold and scheme on one page

Where It Is Asked

Paper	What to expect
Prelims P-I (Part 1, India GS)	Fact-based MCQs: features of the 1956 and 1991 policies, reserved and licensed industries, Ratna criteria, DIPAM’s history, MSME limits, MUDRA categories, scheme launch dates, PLI sectors, IIP/ICI facts. Statement-based and match-the-following formats are common
Mains P-V (GS-III), Economy section	Short answers (features of IPR 1956, disinvestment vs strategic sale, MSME definition) and longer analytical answers (evaluate 1991 reforms, disinvestment, problems of MSMEs, success of Make in India), ideally with Chhattisgarh examples

Exam focus

High-yield: IPR 1956 (17 + 12 industries); NIP 1991 changes; 2 reserved and 5 licensed industries today; Maharatna thresholds (25,000 / 15,000 / 5,000 crore); MSME limits from 1 April 2025; PLI (14 sectors, ₹1.97 lakh crore); nine core industries in the 2022-23 ICI.
Common mistakes: using the 2020 MSME limits; “eight core industries” from old books; mixing up reserved and licensed lists; confusing Startup India with Stand-Up India.
Chhattisgarh angle for Mains: Bhilai (IPR 1956), BALCO (2001 sale), NMDC Steel Nagarnar (pending sale), SECL Bilaspur, MSMEs in rice milling, forest produce and crafts, and the state’s Industrial Development Policy 2024–30.

Quick Reference: Industrial Policy at a Glance

Item	Key fact
IPR 1948	6 April 1948; four categories; mixed economy
IDRA	1951; licensing law, still in force
IPR 1956	30 April 1956; Schedule A 17, Schedule B 12, Schedule C rest
MRTP Act	1969; replaced by Competition Act, 2002
New Industrial Policy	24 July 1991; delicensing, de-reservation, FDI up to 51% automatic
Reserved for public sector (2026)	2: atomic energy, railway operations
Compulsory licensing (2026)	5: alcohol, tobacco products, defence/aerospace electronics, explosives, hazardous chemicals
Maharatna	Since 2009; 14 CPSEs (2026); newest HAL (October 2024)
DIPAM	Department of Disinvestment (1999), renamed 14 April 2016
MSME limits (from 1 April 2025)	Micro 2.5/10, Small 25/100, Medium 125/500 (₹ crore, investment/turnover)
Make in India	25 September 2014
PLI	14 sectors; ₹1.97 lakh crore
Index of Core Industries	Base 2022-23 (July 2026); 9 industries; iron ore added

Start Learning

Begin with the first topic:

→ Industrial Policies of India (1948–1991)