Role of Industry in Indian Economy.

Role of Industry:

India is an industrially backward country. The modern process of industrialisation started in India after independence. The significant of industrial development can be explained below-

(i) Increase in national income: Industrial development contributes significantly in India's GDP (Gross Domestic Product). The contribution of the industrial sector has been increasing continuously.

Role of industry in Indian Economy

(ii) Employment Generation: Industrialisation means the establishing of new enterprises. Thus it creates employment opportunities directly or indirectly. In our country the surplus of labour of agricultural sector govt employment opportunities in the industrial sector. It should be noted here that village based cottage industries are labour intensive, hence they create job opportunities.

(iii) Increase in capital formation: Industrial development will increase per capita income, hence it will raise the level of saving and capital formation in the economy.

(iv) Improvement of standard of living: Industrialisation provides better sources of income. People grow rich after meeting their basic requirements like food and setters. They spend the surplus income on different types of luxurious items. Thus their standard of living rises.

(v) Self sufficiency: Due to less industrial development have to depend on other nations to meet as demands. But industrial development make country self sufficient in the production of essential goods and services. Thus it saves valuable foreign exchange.

(vi) Balance regional development: Industrialisation helps to achieve balance regional development. The govt of India established several basic and key industries in the backward region. Such industrialisation process helps to remove regional imbalance.

(vii) Use of surplus labour: Industrial development is necessary for utilization of surplus labour. The agricultural sector is unable to provide gainful employment facility to surplus labour. The industries used these labour force productivity.

(viii) Use of agricultural outputs: Industrial development is necessary to use the agricultural output property. Several industries have been developed on the basis of agricultural output such as sugar industry tea industry etc.

(ix) Development of human capital: Industrial development creates an environment for proper human capital development which is because industrial developed invites the establishment of training institution management, school, higher study centre etc.

(x) Contribution to national defence: India has set up a no. of industry producing defence equipment's, such as weapon, tanks, helicopters, guns etc. Thus development of industries enables India to be a strong country.

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