9.10          ndian     onom
     economic structure had to be induced with                    only five industries30 which carry the burden of
     the help of another industrial policy. The new               compulsory licencing:
     industrial policy, announced by the government                      (i) Aero space and defence related electronics
     on 23 July, 1991 had initiated a bigger process                   (ii) Gun powder, industrial explosives and
     of economic reforms in the country, seriously                              detonating fuse
     motivated towards the structural readjustment                    (iii) Dangerous chemicals
     naturally obliged to ‘fulfill’ IMF conditionalities.29           (iv) Tobacco, cigarette and related products
     The major highlights of the policy are as follows:                (v) Alcoholic drinks
     1. De-reservation of the Industries                          3. Abolition of the MRTP Limit
     The industries which were reserved for the Central           The MRTP limit was Rs. 100 crore so that
     Government by the IPR, 1956, were cut down to                the mergers, acquisitions and takeovers of the
     only eight. In coming years many other industries            industries could become possible. In 2002, a
     were also opened for private sector investment.              competition Act was passed which has replaced the
     At present there are only two industries which               MRTP Act. In place of the MRTP commission,
     are fully or partially reserved for the Central              the Competition Commission has started
                                                                  functioning (though there are still some hitches
                                                                  regarding the compositional form of the latter and
           (i) Atomic energy and nuclear research and             its real functions and jurisdictions).
                other related activities, i.e., mining, use
                management, fuel fabrication, export-             4. Promotion to Foreign Investment
                import, waste management, etc., of                Functioning as a typical closed economy, the
                radioactive minerals (none of the nuclear         Indian economy had never shown any good
                powers in the world have allowed entry of         faith towards foreign capital. The new industrial
                private sector players in these activities, thus  policy was a pathbreaking step in this regard. Not
                no such attempts look logical in India, too).     only the draconian FERA was committed to be
         (ii) Railways (many of the functions related             diluted, but the government went to encourage
                to the railways have been allowed private              .     n            there were ust         industries under the
                entry, but still the private sector cannot                  compulsory licencing provision. y the fiscal
                                                                            the num er remained five u lications ivision, India
                enter the sector as a full-fledged railway                  2016 ew elhi overnment of ndia,                   . hough
                service provider).                                          the num ers are still five, all these five industries have
                                                                            many internal areas which today carry no obligation of
     2. De-licencing of the Industries                                      licencing. As for example, the electronic industry was
                                                                            under this provision and entrepreneurs needed licences
     The number of industries put under the                                 to produce radio, tv, tape-recorder, etc., what to ask of
                                                                            mobile phones, computers, DVDs and i-pods. Now
     compulsory provision of licencing (belonging to                        only those electronic goods carry licencing provision
     Schedules B and C as per the IPR, 1956) were                           which are related to either the aero-space or the defence
                                                                            sectors—thus we see a great number of electronic
     cut down to only 18. Reforms regarding the area                        industries freed from the licencing provision the item
     were further followed and presently there are                          ‘electronics’ still remains under it. Similarly while ‘drug
                                                                            & pharma’ still belong to the licenced industries, dozens
       29.    Rakesh Mohan, ‘Industrial Policy and Control’s, in            of drugs and pharmaceuticals have been made free of
               imal alan ed. , The Indian Economy: Problems and             it. The six industries have gone for high-level internal
              Prospects ew elhi enguin oo s,        , pp.       .           de-licencing since the reforms started.