Economic Development Model for Uniform Wealth Creation

1: Basics of the Economic Development Model

The Directive Principles of State Policy, in Articles 36 to 51 of the Indian Constitution, state that:

a. the ownership and control of the material resources of the community are so distributed as best to subserve the common good

b. the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment

The Indian governments believed that

i) development should result in a diminution of economic and social inequalities

ii) process of reducing inequalities should be achieved by raising incomes at lowest levels and reducing incomes at the top.

iii) prevention of private monopolies and concentration of economic power in different fields in the hands of small numbers of individuals was required to reduce disparities in income and wealth.

iv) private monopolies were to be prevented and setting up of smaller and medium size private enterprises and Cooperative Organizations to be encouraged.

Assessment of investments required for Economic Development

Planning Commission of India studied investments made by UK, USA, Japan, etc. during their development phases and found

a) Britain made an average net investment of 10 to 15% during 1870-1913.

b) USA made a net investment of 13 to 16% of the national product (gross investment 21- 24%) to increase national income five-fold between 1869 and 1913 (increase in per capita income by over 130%).

c) Japan made new capital formations of 12% of the national income during 1900-1909, which rose to 17% for the period 1909-19 but declined to 12%. in the period 1920-1929.

d) USSR made a net investment of 20% of the national income in the decade 1928-1938 to increase the national product in 1928 by around 130% in 1940.

A somewhat low rate of capital formation might have been adequate for countries like the U.K. and the U.S.A., in which modern industrialism took root early.

The underdeveloped countries which made a late start had to aim at comparable development within a briefer period. In underdeveloped countries with low standards of living and rapidly increasing population, a rate of growth (in production capacity and production in all sectors) commensurate with needs (forecasted demands) could not be achieved until the rate of capital formation of around 20% of the national income is realized.

Based on this study, following algorithms were developed and used for the development model

1) A doubling of per capita income within a generation or so (that is in 25 to 30 years) required a rate of net investment of the order of 12-15% of the national income and capital formation of around 20% of the national income.

2) The First Five Year Plan (I 5YP) was based on Harrod-Domar model.

3) The II 5YP was made using Mahala Nobis model designed to determine optimal allocation of investment between productive sectors in order to maximize long-run economic growth.

4) Five Year Plans were made on the basis of Incremental Capital-Output Ratio, which is the ratio of investment to be done to targeted increase in National Income.

Investment Planning in Five Year Plans

a) In the I, II and III 5YPs, Investments were planned to obtain rise in National Income of Rs. 1890 Cr (1960-61 prices), Rs. 2680 Cr and Rs. 4500 Cr with an ICOR expected of 1.8:1, 2.3:1 and 2.31:1 respectively.

b) For the IV and V 5YPs, the ICOR assumed were 3.4 and 3.7 respectively.

c) The ICOR, which relates the increase in GDP at market prices to the total investment over the Plan period, was expected to be around 5 in VII 5YP. (7.3.21)

d) An expected investment of Rs. 798000 Cr in VIII 5YP implied an investment rate of 23.2 % of GDP. The stipulated ICOR of 4.1 suggested this investment was expected to generate a growth of 5.6 % in GDP. (8.3.2.8; 8.2.8.2)

e) The projected public sector plan outlay for IX 5YP, consistent with the accelerated GDP growth of 7 % per annum envisaged, was placed at Rs.859200 crore at 1996-97 prices. (9.3.1)

Investment Rate planned in IX plan was 28.3% of GDP at market price. IOCR planned was 4.0 (9. Table 2-4)

f) Investment of 28.41% of GDPmp during X plan was expected to yield a GDP growth rate of 7.93% per annum with an assumed IOCR of 3.58. (10. Table 2.7)

Investment requirement forecasted for X plan was Rs 40,81,700 Cr (including Private investment of Rs 24,76,100 Cr, Public sector investment of Rs. 12,12,800 Cr and Additional required of Rs. 392800 Cr (10. Table 2.14)

g) The total public sector outlay in XI 5YP (Centre, States and including their PSEs) was estimated at Rs 3644718 Cr. The public sector outlay was expected to be 13.54% of GDP compared to the average of 9.46% of GDP that was achieved in the X Plan. (11.1.154)

Investment Rate in XI plan planned was 36.7% of GDPmp, ICOR planned was 4.1 and planned GDP Growth Rate – 9% per annum. (11.2.5) (11. Table 2.2)

Achieved GDP Growth, Rates of Investment and ICOR in Indian Economy (1951-2013) (Ref. 8 Table 1.1 and updates in subsequent plans)

Strategy of public sector investment - After investing 44% and 30% of total outlay of I and II 5YPs for agriculture, irrigation and power projects, government embarked on development of industrial sector in 3 5YP. (3.3.5. Table 2) It felt that all industries of basic and strategic importance, public utility services and other industries (which were essential and required investment on a scale which only the State, in existed circumstances, could provide) should be in the public sector.

A number of basic industries which required large investments and extensive collaboration with foreign firms or governments and which could be undertaken only on the assurance of future prospects, with no immediate gain in sight, could not normally be started if reliance was to be placed entirely on private enterprise. Moreover, in the case of industries where for technological reasons, the plants had to be large, requiring big investments, by organizing them in the public sector, undue concentration of economic and industrial power in private hands could be prevented. (3.16.2)

Heavy Electricals plants at Hyderabad was started with the collaboration of Czechoslovakia and Barauni and Gujarat Koyali Refineries, Bhilai, Bokaro and Visakhapatnam Steel plants were built with the collaboration of USSR governments, Durgapur Steel Plant with the collaboration of UK government, Rourkela Steel Plant with the collaboration of German government, Noonmati Refinery with the collaboration of Rumania government, Haldia Refinery with the collaboration of French / Rumania governments, etc

The book describes the principles and success of Economic Development Model, adopted by Indian governments, with average net investment of 21.68% of the national income, jointly by government, public institutions and private sector, by making planned and coordinated investments, through 11 Five Year Plans in various sectors of economy, required to achieve incremental targeted production capacities in all sectors, which themselves were set to meet the forecasted demands in all sectors and make country self-sufficient.

This investment model, with average 47% of total investment for starting public sector units, helped to achieve incremental production targets in each Five-Year Plan, by reinvesting in new projects or for increasing existing production capacities. The model gave sizable income through continuously increasing dividends by public sector units from 1980-81, which started increasing rapidly from 2006-07 onwards.

Corrective actions suggested to achieve constitutional targets –

1) To advocate for continuation of joint (public and private sectors) investment of 20% of the national income for increasing the production capacities according to forecasted increase in demands, for building national assets and achieving targeted growth in GDP. (As, such planned investment has stopped from 2014)

2) To stop closure of companies, which are producing at or near rated capacities with designed per unit consumption of raw materials and consumables, because they were making cumulative losses accruing from startup periods, without considering production losses in respective sectors after closure of these companies and arranging for meeting the demands for these products.

3) To stop disinvestment in Central Public Sector Establishments to prevent reduction of income to governments in the form of dividends, which have very high potential to increase year after year.

4) To stop strategic sale of CPSEs, with high potential for growth and good market share, to prevent creation of corporate house monopoly in critical sectors by transfer of national assets.

5) To stop privatization of Rs. 600,000 Cr worth of national assets under Asset Monetization Plan, which is aimed to sell most national assets, hiving off business of ONGC, privatization of airports and port operations, disinvestment in insurance and banking operations, etc.

Approach

1) Rate of investment done in the past and GDP growth obtained during corresponding periods have been presented as a proof of success.

2) Loss in production on account of shutdown of CPSEs have also been presented

3) Losses in dividends from CPSEs on account of disinvestment and strategic sale have been brought out

Hypothetical Model

The development model referred to in this book is a virtual / hypothetical model and does not refer to models actually used in five-year plans. This book does not give how much investments were made project wise to increase production levels in various sectors to meet forecasted demands. It only gives the increase in installed capacities and actual production achieved in 16 sectors including contribution from public sector units.

Unrestricted growth of private sector illustrated

a) All the 12 Five Year plans were made jointly with private sector investment averaging 53%, contrary to the propaganda that private sector companies were not allowed to start or produce freely prior to liberalization in 1991, as a measure of extending protection to public sector units.

b) List of major private sector companies, which operated in each sector, is given. The lists show that about 457 of total listed 637 private companies were started before 1991, 170 companies were started between 1991 and 2013 and only 10 private companies were started after 2014.

c) In sectors like Cement, Consumer Products for Basic and Secondary Needs, Communication including mobiles and television, Finished and Saleable steel, Aluminium, Copper, (Zinc and Lead after 2002), bulk drugs and formulations, Di-Ammonium Phosphate, complex fertilizer and Bio-Fertilizer, etc., private sector companies played a lead role before liberalization.

d) Actually, around 1967, measures were taken for import liberalization following devaluation, decontrol of certain commodities like steel, coal, paper, fertilizers and commercial vehicles, delicensing of a number of industries, etc.

e) Licensing for production in any particular sector was never a constraint in achieving desired production capacities in any sector and were used to protect smaller private companies.

f) Crucial part played by private sector in the development of economy with participation of several big groups of private sector companies like Tata, Birla, L&T, Bajaj, Murugappa, Kirloskar, Mahindra, Hinduja, Godrej, ITC, Wadia, and others contributing in a big way to economic development up to 2002 and private sector companies playing leading role in several sectors.

Support of public sector for private sector growth

Many big ventures of private companies got investment support from public sector units like LIC, UTI, Financial Institutions, public sector banks, etc. including Reliance Industries Ltd., the largest private sector company in India by market capitalization.

In India, many small private sector banks were rescued from closing down by public sector banks at the initiative of Reserve Bank of India. If such a set up was there in US, banks like Silicon Valley Bank, Signature Bank, First Republic Bank, 29 banks between 2015-20, etc. would not have closed down.

Contribution of public sector to Indian economy

The public sector units’ contributions to India’s GDP, to government as dividends and to government’s capital expenditure.

The book promotes economic development model, which besides helping to achieve production targets, also played a very big role in improving the living standards of the people of Scheduled Tribe, Scheduled Caste and Other Backward Communities by providing reservation for these people in education and employment in CPSEs and government offices.

The fact that no private companies (like Tata group, or Birla group or L& T group, etc.) grew into a monopolistic company controlling any sector dominantly up to 2000 is testimony to success of this model. After selling of public sector units from 2001-02, companies like Reliance Industries, Vedanta, Adani group have become monopolistic companies in some crucial sectors.

Growth in GDP

Nominal GDP in 2019: $2.94 trillion-India GDP (PPP): $10.51 trillion. The services sector accounts for about 61.5%, industrial sector 23 % and agriculture 15.4 % of country’s GDP. India has become the fifth-largest economy in 2019, overtaking the United Kingdom and France.

Ref: IMF's World Economic Outlook Database, October 2019. Countries by GDP: The Top 20 Economies in the World (investopedia.com)

With a GDP of roughly $ 3.4 Trillion, India, in January 2024, was the fifth-largest economy in the world, after the US, China, Japan and Germany.

Ref : India set to be world's 3rd largest economy by 2027-28: FM - Times of India (indiatimes.com)

Thus, India, not only remains unchanged in the fifth rank from October 2019, but has also not overtaken Germany’s GDP of $ 3.86 Trillion in October 2019 even in January 2024. So where is the growth?

I dedicate my book to Jawaharlal Nehru, Architect of Modern India, whose approach to meticulous planning of five-year plans inspired me to write this book and I express my gratitude to my wife, who supported me all through these 2 years, I was engaged in writing this book.

This improvement in living standards of Scheduled Tribe, Scheduled Caste, Other Backward Communities people of India can give a hint for improving median wealth of Native Americans, which was only 8.7% of median wealth among all Americans in 2000 (Chang 2010, 14).

Similarly, Australian economists can also take hint for improving the living standards of indigenous Australians or aboriginals.

Abbreviations –

(AA.BB.CC) – Reference, where AA – 5YP number, BB – Chapter and CC – Bullet number

Mt - Million tons

Bt - Billion tons

Lakh – 100,000

Cr – Crore – Ten Million - 10,000,000

MMSCMD - million metric standard cubic meters per day

Dates are given in DD.MM.YYYY format.

Ckms – Circuit kms

Note – Some Tables and Graphs have been removed from the book to limit the number of pages of the book. However, these information can be provided to interested readers against specific request to author.

2: GROWTH IN PRODUCTION OF CEMENT AND MANUFACTURING OF CEMENT PLANT MACHINERIES

Cement is required for all buildings and structures - from houses, office and factory buildings to dams and roads. The demand for the cement in India has been influenced mainly by the housing, infrastructure, irrigation and so on.

India achieved self-sufficiency in 1992-93 and became the second largest cement producer of the world in 2006-07. (11.v3.7.1.166)

Targeted Growth for Cement Production

The cement requirements were forecasted by the government for the last financial year of each 5-year plan and the target cement production capacity for the various 5-year plans were set. The capacity built up and actual production achieved at the end of each 5-year plan and some other periods are given in Table 1.1.

Growth of Cement Production

India’s cement production increased from 2.69 Mts in 1950 to 4.3 Mts in 1955-56, 7.97 Mts in 1960-61 and 10.8 Mt in 1965-66, 12.2 Mts in 1968-69

During the period 1969-74, the government decided that the public sector should enter the field of consumer goods industries, particularly in fields in which adequate private investment was not forthcoming. Specific provision was made for public sector role in consumer goods industries like cement. (4.14.37)

Growth during VI 5YP - The scheme of partial decontrol of cement introduced in February 1982 and the liberal policy adopted by the Government in respect of price and distribution and permitting MRTP / FERA companies to set up projects generated enthusiasm among the entrepreneurs to set up additional capacity. 4 Cement plants (Ambuja Cements, L & T Cement, UltraTech Cements and Vasava Datta Cement), were started in 1983 in private sector.

Growth during VII 5YP – Decontrol and delicensing - Consequent on complete decontrol of cement in March, 1989 and subsequent delicensing of the industry in July 1991, the industry made big strides both in production as well as capacity addition. (8.2.8.8)

Status

In 1992-93, the county turned from cement shortage to cement surplus status by 1992-93, when it exported nearly 3 Mts of cement/clinker. (8.5.23.1)

Cement capacity reached 71.19 Mts and production 56 Mts in 1993. India ranked fifth among the cement producing countries after China, Russia, Japan and USA.

In 2001-02 - The cement industry in India became self-sufficient both in raw material availability and process technology as well as indigenous sources of plant and machinery. It was comparable to the best in the world in respect of quality standards, fuel and power consumption and environmental norms. It contributed to 6% of the world production. (10.7.1.172)

Installed capacity of Cement industry was 140.53 Mts (129.43 Mts from 120 large plants and 11.1 Mts from 365 mini plants). Of these 365 mini plants, only about 132 plants, were reported to be in operation, producing about 4 Mts of cement. Production of cement was 100.1 Mts in 2000–01 (10.7.1.172 / 12.4.49)

In 2006-07 - India became the second largest cement producer in the world. (11.v3.7.1.166)

In 2008-09 - As of March 2009, Indian cement industry comprised of 148 large cement plants and 365 mini-cement plants, with installed capacities of 219 Mt and 11 Mt respectively. (12.4.65)

In 2010-11 - Production of cement was 228.3 Mts. (12.4.49).

India’s cement production increased to 255.83 Mts in 2013-14 to 274 Mts in 2015-16, 291 Mt in 2017-18 and 329 Mt in 2019-20. India: cement production volume 2022 | Statista

In 2022, 210 large cement plants accounted for a cumulative installed capacity of over 410 MT, while over 350 mini cement plants had an estimated production capacity of 11.10 MT. IBEF Presentation

In 2023 - India’s cement production reached 374.55 Mts in FY2023. (Ibef.org)

Cement Production by CPSE

Cement Corporation of India Limited was incorporated on 18.01.1965.

The cement plants at Rajban, Neemuch, Akaltara and Yerraguntala with a total capacity of 1.4 Mts were expected to be commissioned during 1979-80. *World Bank Document (P56)

Chunar Cement Factory, Unit of U.P Cement Cooperation, was started in 1982 with capacity of 1.68 Mts. (6.16.70). The factory was stopped in the year 1999 due to some technical problem.

In 1984-85 the public sector provided 14% of cement output (7. Annex 2-3) with 1.99 Mts by CCI with capacity of 2.62 Mts and 2.26 Mts from 8 smaller State Government-owned companies with capacity of 4.96 Mts. World Bank Document

Hira Cement Works, which started producing cement in 1968, was taken over by Industrial Development Corporation of Orissa Ltd. in 1980s. The company discontinued producing Portland Pozzolana cement, reaching a peak production of 0.457 Mts in 1988-89.

IDCOL Cements Ltd., subsidiary of Industrial Development Corporation of Orissa Ltd., was founded in 1993 to operate Hira Cement Works. This plant produced 0.419 Mt in 1995-96.

Steel Authority of India was setting up a 2 Mts slag cement capacity at Chilhati.

In 1995-96, the public sector accounted for 10% of capacity and production, down from 18% in 1984-85. The capacity of public sector plants increased from 7.6 in 1985 to 9.9 Mts in 1995. World Bank Document

In 1996-97, over 85% of capacity was with private sector, the public sector accounting for 15% of capacity and CCI contributing to less than 5% of production. (9.5.213)

Public Sector Companies

Cement Corporation of India Ltd.

Cement Corporation of India Ltd. - CCI was incorporated on 18-1-1965 to help achieve self-sufficiency in cement production in India. CCI manufactures special grade cement also for manufacture of sleepers for Indian Railways.

Mandhar unit, first CCI plant (capacity 0.38 Mts), Kurkunta plant (0.198 Mts), Bokajan unit (0.198 Mts), Rajban unit (0.198 Mts), Akaltara unit (0.4 Mts), Nayagaon unit (0.4 Mt), Yerraguntala unit (0.4 Mts), Adilabad unit (0.4 Mt), Tandur unit (1 Mt) and Delhi grinding unit (0.5 Mts) were commissioned on 19.07.1970, 1.10.1972, 01.04.1977, 01.04.1980, 01.04.1981, 01.03.1982, April 1982, 01.4.1984, 1.7.1987 and 01.05.1990 respectively.

Sick Charkhi-Dadri unit was taken over by Government and vested with CCI in 1981. After rehabilitation, clinker production started on 10.5.1982 with 0.174 Mts. Capacity.

Nayagaon Neemuch expansion project for another 1 Mts was undertaken with clinkerisation at Nayagaon and grinding of clinker at Delhi and Bhatinda. They started commercial production on 1.05.1990.

The public sector cement plants’ production was 15% of total production in 1979-80, 14% in 1984-85 and 6% in 1989-90 and total installed capacity was 4.216 Mts in 1994.

CCI started a joint venture company Damodhar Cement & Slag Ltd., Madhukunda with West Bengal Industrial Development Corp. on 19.7.1983 for manufacture of slag of 0.3 Mts and cement grinding of 0.27 Mts.

CCI made a net profit of Rs. 831.84 Cr in 2005-06.

The performance of CCI was adversely affected due to severe liquidity crunch and power shortage. 7 units Mandhar (on 6.6.1996), Charkhi Dadri (on 14.8.1996), Akaltara (on 9.12.1996), Nayagaon and Nayagaon Expansion (on 30.6.1997), Kurkunta (on 1.11.1998), Adilabad (on 5.11.1998) and Delhi (on 8.2.1999) were closed and Bhatinda unit was not commissioned.

Yerraguntala plant was sold to India Cements Ltd. on 21.01.1998 for Rs. 200.70 crore.

The rehabilitation scheme sanctioned by BIFR on 3.05.2006 suggested closure of 7 unviable plants located at Mandhar, Kurkunta, Akaltara, Charkhi Dadri, Nayagaon and Adilabad and Delhi / Bhatinda Grinding units, and sale of assets of those plants through Asset Sale Committee.

Total installed capacity of the plants was 4.248 Mts in 2007-08. Installed capacity of 3 operating plants was 1.446 Mts.

Under revival schemes, expansion of Rajban Unit and modernization of Tandur unit were taken up.

Tandur unit produced of 0.7 Mts in 2013-14. Dispatches of cement during 2014-15 were 9.47 Lakhs MT. Overall capacity utilization of CCI Ltd. stood at 66%.

As on 2015, CCI was earning profit from 2007 with its Rajban, Bokajan and Tandur plants.

The installed capacity in 2019-20 was 1.4615 Mts for cement.

TABLE 2.1 - Cement production in million Tons

Manufacturing of Cement Machineries

The government set targets for manufacturing of cement machineries required for establishment of new cement plants to meet growing demands for cement. The targets set and achieved manufacturing of cement machineries are given in Table – 1.2.

Machine Building in Private Sector - Associated Cement-Vickers-Babcock Wilcox plant at Durgapur was to be established during III 5YP for manufacture of cement plant equipment. (3.26.55)

Targets were set production of complete cement plant machineries for 6 to 7 plants, each of 500 tons per day capacity by private sector.

Table - 2.2 Cement Machineries Production in Rs. Crores

Acquisition is a bad strategy

On May 15, 2022, Adani Group acquired Holcim's stake in Ambuja Cements and ACC for US$10.5 billion.

Adani's Ambuja Cements Ltd acquired Sanghi Industries Ltd, the world's largest single-stream cement plant, located at Sanghipuram in Kutch district, in December 2023 and CK Birla's Orient Cement at of INR 8,100 Crore in October 2024.

Acquisition of existing companies does not increase existing installed capacity or reduce shortfall in supply. (The acquiring company’s inventory and operating cost reduce and profit increases additionally due to reduced competition in the market). If the same amount was invested for starting new companies, the installed capacity and production would have increased and shortfall would have reduced. Thus, acquisition of operating companies for profit is a bad policy and promotes monopoly.

Summary – The cement production was 374.55 Mts in 2022-23. However, the contributions from public sector were small, as new plants did not come up in public sector after 1990.

Private Sector Players -

ACC (1936 – 17 plants), Dalmia Cements (1939), Hyderabad Industries Ltd (1946), India Cements (1946), Grasim Industries Ltd (1947), Shree Digvijay Cement (1949), Ramco Cements (1961), Chettinad Cements (1962), Kesoram Cement Ltd (1969), Century Textile & Industries Ltd (1974), Mangalam Cements (1976), Rasi Cements (1978), Jaypee Rewa Cement plant (1979), Orient Cement (1979), Ambuja Cements (1983), L & T Cement (1983, 1995 and 2000, was India’s largest cement producer with installed capacity of over 14 Mts), UltraTech Cements (1983), Vasava Datta Cement (1983), Dharani Cement (1985), Sanghi Industries (1985)

J K Cements (1994), Binani Cement (1996), Indian Rayon Cement Division (1998), Star Cement (2001)

36 Plants started before 1991, 4 plants started between 1991 and 2013.

3: GROWTH IN PRODUCTION OF COAL

Coal is required for many industries like power plants, railways, cement, sponge iron, pig iron / steel, fertilizer, brick and others. Coal was the mainstay of energy sector accounting for over 50% of primary commercial energy supply from 1950-51. This share was 73.1% in 2022-23. India's power output grows at fastest pace in 33 years, fuelled by coal | Reuters

Targeted Growth for Coal Production

The coal requirements for power, cement, fertilizers, iron and steel, etc. industries were forecasted by the government for the last financial year of each 5-year plan and the target coal production capacities for the various 5-year plans were set. Total projected demand for XII 5YP of 980.50 Mts was set considering coking coal requirement of 67.2 Mt, and non-coking coal requirement for power plants, cement, sponge iron / steel, fertilizer, brick and other industries of 738.44 Mt, 47.31 Mt, 50.33 Mt and 77.22 Mt respectively. (12. Table -14.27)

Exploration of Coal Deposits

Geological Survey of India undertook preliminary exploration to identify potential coal and lignite deposits.

Mineral Exploration Corporation Ltd. was carved out of Geological Survey of India in 1972 for carrying out detailed and systematic exploration of mineral potential deposits.

Central Mine Planning & Design Institute Ltd. provided consultancy for geological exploration and remote sensing to generate geological and geo-engineering data and prepare mining project reports, geophysical survey through multi-probe geophysical logging; high resolution shallow seismic survey; hydro geological investigation and identification of coal bed methane resources.

Neyveli Lignite Corporation, Gujarat Minerals Development Corporation and Rajasthan State Mines and Minerals Ltd undertook exploration drilling for establishing lignite resources.

The coal reserves predicted and proven since 1950 are given in Table – 2.1.

India had an estimated 1000 billion cubic meters of Coal Bed Methane (10.7.3.12)

Table – 3.1 - Coal Reserves in Million Tons

Coal Production in India

In 1950-51, coal production was with private sector and the production was 33 Mts (6.15.54).

Of the total estimated consumption of 32.307 Mts, 31.1% was consumed by Railways, 13.6% by Iron, Steel and Brass industries, 9.4% by Brick, Tiles and Refractories industries, 8.5% by Cotton, Woolen, Jute and Paper mills, 6.9% by Steam electric utilities.

Railways (40%) and iron and steel industry (21%) consumed metallurgical grade coal. (1.27.18)

In 1955-56

National Coal Development Corporation was set up in 1956 with the collieries owned by the railways.

Singareni Collieries Company Ltd. was taken over by Government of Andhra Pradesh in 1956. (2.18.8)

Neyveli Lignite Corporation Ltd. was incorporated on 14.11.1956 to produce raw lignite required for a 250 M.W thermal power plant, a 70,000 tons urea fertilizer plant and a briquetting and carbonization plant for producing 0.38 Mts carbonized briquettes. (3.27.37)

In 1960, production from the mines of NCDC, Singareni collieries and private sector increased to 13.7 Mts, 2.6 Mts and 45.7 Mts. respectively. (3.27.4)

Nationalization of Coal Mines

i) In 1970, adequate capital investment to meet the burgeoning energy needs of India was not forthcoming from the private coal mine owners.

ii) Unscientific mining practices adopted by some of them and poor working conditions of labour in some of the private coal mines became matters of concern for Government.

First, the coking coal mines and the coke oven plants other than those with the Tata Iron & Steel Company Ltd. and Indian Iron & Steel Company Ltd., were nationalized on 5.1.1972 and brought under Bharat Coking Coal Limited. Coking and non-coking coal mines in 7 States were nationalized on 1.5.1973

*The industry was reorganized in 1975 with the creation of Coal India Ltd. Singareni Collieries Company Ltd, however, continued to be a jointly owned company of Andhra Pradesh and Central Governments. (8.8.33.1)

Growth during V 5YP - With the introduction of new methods in the development of mines, production was raised by 22 Mts in the first 2 years of V Plan. The 100 Mts level was reached in 1975-76. (6.15.54)

Growth during VI 5YP - 59 major coal-handling plants and 19 washeries with total capacity of 32.86 Mts were set up during the VI Plan. (7.6.92)

*Sectoral breakup of total consumptions of coal in 1984-85 of 139.23 Mts were: Power – 44.7%, Steel & coke ovens – 17%, Railways – 6.8%, Cement – 5.09%, Fertilizers – 2.8%, Soft coke / LTC – 1.5%, jute, paper, cotton textiles, chemicals, bricks, etc. - 19%.

India became third largest producer of coal (398 Mts) in 2005 after China and USA.

During X 5YP, it was decided to allot Coal blocks / linkage to successful bidders for setting up thermal power stations. (10.10.37)

In 2008-09 - The production capacities of Bharat Cooking Coal Ltd, Eastern Coalfields Ltd, Northern Coalfields Ltd, South Eastern Coalfields Ltd., Neyveli Lignite Corp. Ltd and Coal India Ltd. were 29.138, 29.385, 65.51, 104.55, 24.0 and 412.13 Mts respectively.

23.2 Mts of coking coal was imported in 2010-11 to meet the 40 Mts demand of coking coal for steel plants and coke ovens. (12. Annex. 14.2)

In 2011-12 - The expected production from captive blocks fell short of the projected target of 104 Mts in the terminal year of XI Plan because only 29 captive blocks could start production out of the 195 blocks allocated till then. The main impediments were delays in forest and environmental clearances, problems of land acquisition, etc. (12.14.100)

*Out of the total consumption of 584.78 Mts of non-coking coal, power plants, fertilizer plants, captive power plants, Steel DRI and cement plants consumed 405 Mts, 85 Mt, 40 Mt, 28.8 Mt and 25.98 Mt respectively.

*The import of coal in 2011-12 was 90 Mts and was projected to be 185 Mts in 2016-17 (12.14.129)

*The coal washing capacity at the end of XI Plan was 29.88 Mts. for coking coal and 95.96 Mts. for non-coking coal. (12.14.112)

*Private sector was allowed to do coal mining in Meghalaya, which had private ownership of land and coal.

In 2023 - 24 –

Coal production grew to over 893 Mts in 2022-23 and is expected to top 1 billion Tons by March 2024.

Coal Index: Drop in coal index hints at reduced input cost for steel | Delhi News - Times of India (indiatimes.com)

Coal Bed Methane The government offered 33 blocks, in 4 rounds of bidding (in 2001, 2003, 2005 and 2008), for CBM covering 17,416 sq. km of area. Raniganj coalfield commenced commercial production in 2007. The production of 0.2 MMSCMD was confined mostly to private sector. (12.14.113)

Table - 3.2 - Target, Total achieved, CPSE achieved Coal Production in million Tons

Table - 3.3 - Target, Total achieved, CPSE achieved Lignite Production in million Tons

Public Sector Organizations, which contributed for growth in Coal Sector

Indian Bureau of Mines (IBM)

Indian Bureau of Mines was set up on 1-03-1948 to undertake the inspection of mines and detailed exploration of mineral deposits such as Iron Ore, Limestone, Dolomite, Coal, Copper, Tungsten, etc. Later it undertook technical consultancy and preparation of mineral maps leading to complete inventory of mineral resources.

IBM undertook inspection of 2500 mines for scientific and systematic mining; mineral conservation and mines environment, mineral beneficiation studies, utilization of low-grade ores and analysis of environmental samples, modernization and collection, processing, dissemination of data on mines and minerals through various publications. (11.7.2.40)

National Coal Development Corporation

National Coal Development Corporation - NCDC was set up in October 1956 with 11 collieries owned by railways of capacity 2.9 Mts.

8 New collieries were opened between 1956 and 1961 and scientific techniques of coal mining were introduced and production increased to 8.05 Mts.

By 1966, contribution of NCDC to nation’s coal production of 67.72 Mts increased to 9.6 Mts. NCDC’s production increased to 15.55 Mts in 1973-74.

NCDC’s collieries were taken over by Coal Mines Authority Ltd. on 1.5.1973.

Neyveli Lignite Corporation Ltd.

Neyveli Lignite Corp. Ltd. - NLC was incorporated on 14.11.1956 to meet the electricity demand of southern states of India by excavating lignite required for generation of power.

NLC was engaged in exploration and mining of 30.6 Mts. of lignite in 3 Neyveli mines and 1 Barsingsar mine.

NLC diversified into renewable energy production and installed 1404 MW solar power plant and 51 MW capacity windmills. 230MW solar power plant was commissioned in 2017-18.

NLC Ltd. was engaged in operating power plants of 4661.06 MW capacity on 31.08.2020 comprising Thermal-3240 MW, Solar-1370.06 MW & Wind-51 MW. Commissioning of 2X500 MW Neyveli TPS Unit-I and 709 MW Solar plant were completed in 2019-20. 2x500 MW Neyveli TPS Unit 2 was commissioned on 3.2.2021.

NLC has 3 joint ventures namely NLC Tamil Nadu Power Ltd. (with Tamil Nadu Electricity Board, for setting up 1000 MW coal-based power project at Tuticorin), MNH Shakti Ltd. (with Mahanadi Coal Fields Ltd.) and 2000 MW Neyveli Uttar Pradesh Power Ltd. (with Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd)

Mining and Allied Machinery Corporation Ltd.

Mining and Allied Machinery Corporation Ltd. was incorporated in 1964 to manufacture mining equipment. The company was once the conduit for subtle technology transfer across the Iron Curtain - the British technology that it obtained by a collaboration with Dowty Mining of the UK was given to the former USSR in the form of exports of specialized wrenches, winders and haulages, while the Soviet (and Polish) mining drills and other equipment it imported were reverse - engineered and exported to the West. After the war, it was manufacturing scrapper chain conveyors. It was closed on 1.01.2002.

Bharat Coking Coal Ltd.

Bharat Coking Coal Ltd - BCCL was incorporated on 1.1.1972 to take over the private coal mines in Jharia, Jharkhand and Raniganj, West Bengal.

BCCL is engaged in extraction of coking coal (for supply to steel plants) and non-coking coal (for power houses, fertilizer, cement plants) from 35 underground, 13 open cast and 18 mixed mines in Jharia Coalfield and 64 mines in Raniganj Coalfield. BCCL also runs 6 coking coal washeries, 3 non-coking coal washeries, 1 captive power plant and 5 bye-product coke plants in Jharkhand.

The maximum installed capacity of BCCL was 46.05 Mts of raw coal and 6.4 Mts washed coal (coking)in 2019-20.

BCCL was meeting almost 50% of total prime coking coal requirement of integrated steel sector.

Mineral Exploration Corporation Ltd.

Mineral Exploration Corp. Ltd. - MECL was carved out of Geological Survey of India in 1972 and incorporated on 21.10.1972 for undertaking detailed and systematic exploration of mineral potential deposits and to reduce the time lag between the initial discovery of a mineral prospect and its eventual exploitation.

MECL carried out promotional work for coal, lignite and other minerals on behalf of and funded by Government in first phase, and contractual work for exploration of various minerals, CBM, geothermal and geo-technical projects on behalf of public sector, private sector and Central / state governments. During 2004-05 a total of 35 exploratory drilling projects were undertaken by MECL while developmental mining of 7 units were in progress.

The company was having 30% of market share of exploratory drilling in India in 2007-08.

MECL, as contractual agency for Central Mine Planning and Design Institute, undertook detailed exploration drilling activities in Non-Coal India Ltd Blocks and was expected to achieve 8.09 lakh meters in non-CIL blocks during XII 5YP establishing 5.2 Bts of private coal reserves. (12.14.109)

Coal Mines Authority Ltd.

Coal Mines Authority Ltd. - CMAL was established on 1.5.1973 to manage and develop NCDC collieries and other non-coking coal mines nationalized on 1.5.1973.

CMAL owned 36 collieries in Bihar, Orissa, Madhya Pradesh and Maharashtra besides 4 coal washeries, one by-product coke oven plant and 2 large central workshops.

CMAL was renamed as Coal India Ltd following government’s decision to restructure coal industry on 1.11.1975.

Central division of CMAL became Central Coalfields Ltd., a separate public sector company.

Coal India Limited

Coal India Ltd. - CIL was incorporated on 14.6.1973 under Coal Mines (Nationalization) Act as Coal Mines Authority Ltd. This company was merged with Bharat Coking Coal Ltd. in 1975 and renamed as CIL.

Coal India is engaged in coal mining, acquisition of coal mines, exploration, manufacturing and distribution of coke, coal belt methane gas and byproducts through its 3 units (North Eastern Coalfields and marketing offices) and 8 subsidiaries (including Bharat Coking Coal Ltd, Central Coalfields Ltd, Eastern Coalfields Ltd, South Eastern Coalfields Ltd, Mahanadi Coalfields Ltd, Western Coalfields Ltd and Northern Coalfields Ltd., engaged in production of coal and CMPDIL engaged in Research and Development of coal mining).

Coal India Africana Limitada is registered in Republic of Mozambique.

CIL entered into Memorandum of Understanding with SAIL, RINL, NTPC and NMDC for formation of joint venture company International Coal Ventures Pvt Ltd. for acquisition of coal properties abroad. CIL also formed a Joint Venture with NTPC Ltd. namely CIL-NTPC Urja on 27.4.2010.

CIL acquired the assets of Mining and Allied Machinery Corporation (under liquidation) to revive MAMC’s operation and to support underground mining activities with indigenous mining equipment for which CIL had entered into agreement with BEML and DVC.

CIL was supplying almost 99% of crushed coal to power sector in 2011-12. (12.14.140)

A total of 212 Coal Handling Plants with 277 Mts capacity were operating in different subsidiary companies of CIL.

The maximum installed capacity of CIL was 460.44 Mts.

Western Coalfields Ltd.

Western Coalfields Ltd. - WCL was incorporated on 29.10.1975.

It was bifurcated into South Eastern Coalfields L td and WCL w.e.f. 1.1.1986.

WCL is extracting coal from 45 open cast, 2 mixed and 39 underground mines in Nagpur, Chandrapur and Yavatmal districts of Maharashtra and Betul and Chhindwara districts of Madhya Pradesh.

The maximum installed capacity of WCL was 146.403 Mts.

WCL contributes about 8.19% of the national coal production.

Central Mine Planning & Design Institute Ltd. - Consultancy in coal and mineral exploration

Central Mine Planning & Design Institute Ltd. - CMPDIL was incorporated on 1.11.1975 to provide:

i) Consultancy in coal and mineral exploration, mining and engineering.

ii) Consultancy in geological exploration and remote sensing to generate geological and geo-engineering data and assess in situ coal services for preparation of mining projects report, geophysical survey through multi-probe geophysical logging, high resolution shallow seismic survey, hydro geological investigation and identification of coal bed methane resources.

iii) Design of systems for mines, beneficiation and utilization plants, coal handling plants, coal, power and other units, power supply systems, workshops, etc. and

iv) Feasibility reports etc.

CMPDIL rendered consultancy services to 7 subsidiary companies of Coal India Ltd. and to non-CIL clients like NALCO, Tata Steel, HINDALCO, GMDC, SAIL-ISP, OMC, CEA DGH HPGCL, CSEB, NTPC, MECL, Essar Mineral Resources, UCM Coal Company Ltd, JSPL, Adani Mining Pvt Ltd., Field Mining and Ispat Ltd etc.

CMPDIL, with its contractual agency Mandakini Coal Company Ltd undertook 11.2 lakh meters of exploratory drilling in CIL blocks and 9.01 Bts of coal reserves were proved during XI Plan. (12.14.110).

During the year 2016-17, CMPDIL received 26 non-CIL consultancy jobs from 16 organizations.

Central Coalfields Ltd.

Central Coalfields Ltd. - CCL was incorporated on 1.11.1975 to manage the coal mines of central division of Coal Mine Authority, now Coal India Ltd.

CCL was engaged in production of raw coal, washed coal, slurry, soft coke etc. through it 24 underground mines and 41 Open Cast Mines at Hazaribagh, Ranchi and Bokaro in Jharkhand in 2010-11. (There were 71 mines in 2004-05).

CCL has 4 coking coal washeries and 3 washeries for washing / beneficiation of non-coking coal.

71 Mts Magadh Open Cast Mine Project and 27 Mts Amrapali Open Cast Mine Project were made operational in 2019-20.

The maximum installed capacity of CCL was 81.09 Mts of raw coal.

Eastern Coalfields Ltd.

Eastern Coalfields Ltd. - ECL was incorporated as a subsidiary of Coal India Ltd. on 1.11.1975 to reorganize the nationalized coal industry by conversion of Eastern division of erstwhile CMAL. into a company.

ECL is engaged in production of coal for the power sector through 88 under-ground and 24 opencast mines at Burdwan, Bankura and Purulia in West Bengal and Dhanbad, Godda, Deoghar and Pakur in Jharkhand.

The maximum installed capacity of ECL was 56.76 Mts.

Northern Coalfields Ltd.

Northern Coalfields Ltd. - NCL was incorporated on 28.11.1985 to takeover specific coal mining activities carried out in Madhya Pradesh and Uttar Pradesh.

NCL is engaged in Coal extraction from 10 operating mining projects at Jhingurda, Block-B, Jayant, Amlohri, Nigahi in Madhya Pradesh and Bina, Krishnashila, Kakri, Dudhichua, Khadia in Uttar Pradesh.

The maximum installed capacity of NCL was 94.5 Mts.

South Eastern Coalfields Ltd.

South Eastern Coalfields Ltd. - SECL was incorporated on 28.11.1985 to take over business of Bilaspur division of Western Coalfields and Talcher area of Central Coalfields Ltd. (Talcher area was taken out in 1992 to form Mahanadi Coalfields).

SECL is having 16 operating areas at Korba, Raigarh and Surguja in Chhattisgarh and Sahdol in Madhya Pradesh grouped into 3 coalfields namely Central India Coalfields, Korba Coalfields and Mand-Raigarh Coalfields.

The company had 24.5% of market share for its product in 2004-05.

37 Projects of capacity 120.94 MT were under implementation in 2010-11.

SECL was operating 64 mines underground, 21 opencast and 1 mixed mine on 31.03.2014

The maximum installed capacity of SECL was 169.4 Mts in 2019-20.

In 2013-14, SECL was contributing 21.97% of total coal production.

SECL was operating a Coal Carbonization plant ‘Dancuni Coal Complex’ at Dancuni in West Bengal, on lease basis from Coal India Limited.

Mahanadi Coalfields Ltd.

Mahanadi Coalfields Ltd. - MCL was incorporated on 3.4.1992 to take over business of the coalfields of Orissa region of South Eastern Coalfields Ltd.

MCL is in the mining of coal, with 24 mining projects at Angul, Jharsuguda and Sundargarh district of Orissa. MCL is having coal reserves spread over 2 coalfields viz. Talcher and Ib Valley.

MCL is having 4 subsidiaries namely MNH Shakti Ltd., MJSJ Coal Ltd., Mahanadi Coal Railway Ltd. and Mahanadi Basin Power Ltd and 1 joint venture company Neelachal Power Transmission Company Pvt Ltd.

The maximum installed capacity of MCL was 174.591 Mts. MCL contributed about 19.35% of coal production in 2013-14.

MCL took initiative for Solar Power Plant, Paradip Port modernization and setting up of washeries.

Earth Moving & Mining Equipment Sector

Bharat Earth Movers Ltd was the leading manufacturer of earth moving and mining equipment required for mining and construction sectors. Investment in earth moving and mining equipment and construction equipment infrastructure over US$ 1 trillion was planned in the construction industry over the period 2011 to 2020. (12. Annex.13.2.17)

Table - 3.4 CPSEs Share in Domestic Output

CPSE’s share in production of hard coal in 2007-08 and 2011-12 were 84% and 80% respectively and corresponding share for coking coal in 2007-08 was 79% and for lignite in 2011-12 was 85%.

Contribution to Manufacturing GDP

Coke, petroleum products, and nuclear fuel, rubber and plastics Industries contributed 10.6% to Manufacturing GDP in 2009-10

Planned and Actual Contribution to XI 5YP by Coal sector CPSEs

Against the estimated Internal and Extra Budgetary Resources availability of Rs 69926.77 Cr (Rs 51542.55 Cr from CIL, Rs 3340.30 Cr from SCCL and Rs 15043.92 Cr from NLC), the proposed plan outlay for PSUs was Rs 35774 Cr (at constant price) in XI 5YP. While the resource position of SCCL and NLC was just sufficient to meet the plan outlay, there was a huge surplus in that of CIL. (11.10.189)

Actual expenditure during XI Plan under Ministry of Coal was Rs. 26,337.62 Cr. This comprised Rs. 26,374.20 Cr of IEBR of CIL, SCCL and NLC and balance Rs. 1,500 Cr Gross Budget Support for Ministry of Coal funded schemes. The major shortfalls were in the reported expenditure of CIL and NLC whereas SCCL was expected to spend Rs. 3,707.59 Cr against the approved IEBR of Rs. 3,340 Cr. (12.14.121)

Summary

Coal industry was in the hands of private sector up to 1970 and the production was only about 72 Mts. After nationalization of coal mines in 1972-73, the coal production increased rapidly with Coal India Ltd and its subsidiaries playing leading role. CPSE units were contributing more than 80% from 1973-74 onwards.

Private sector players

Adani Mining Pvt Ltd. (2007)

4: PRODUCTION OF CONSUMER PRODUCTS OF BASIC NEEDS

Consumables, daily need of common people

The cost of living of a large majority of people depends on relatively few commodities like food grains, vegetable oils, sugar, salt, cookware, kerosine, cloth, soap, etc.

Targeted growth for consumer products production

The requirements for cloth, food items, detergents and soaps, foot wear, consumables (like dry batteries, electric bulbs, etc.), bicycles, bicycle tires, sewing machines, typewriters, etc. were forecast by the government for the last financial year of each 5-year plan and the target capacity and production of these items for the various 5-year plans were set.

Meeting consumer needs for housing

Hindustan Prefab Ltd. - HPL was established as a government department in 1948, for meeting the housing needs of people who migrated from Pakistan as refugees. HPL was incorporated as Hindustan Housing Factory Ltd in 1953.

Housing and Urban Development Corporation – HUDCO was created on 25.04.1970, against the backdrop of housing deficit in India in 1960s and 1970s, as a private limited company under the ownership of Indian Government for addressing issue of housing finance and urban infrastructure development. HUDCO provided finance for setting up new towns and consultancy services for designing and planning projects relating to Housing and Urban Development programs in India as well as abroad.

Life Insurance Corporation - LIC provided financing for housing. Up to March 1977, LIC had provided Rs. 728.56 Cr in loans for various housing programs. (6.23.23). The contribution of LIC for housing loan increased from Rs.185 Cr. in 1984-85 to Rs.825 Cr. in 1990-91.

National Housing Bank - NHB was set up on 09.07.1988 for

(i) overall regulation and licensing of housing finance companies

(ii) establishing a contractual deposit scheme linked to guaranteed loan from scheduled banks

(iii) refinancing at less than commercial rates of interest of HUDCO and bank's schemes and

(iv) land development and shelter program of public and private agencies; (8.14.3.10)

Meeting consumer needs for clothing

Textile Production in 1950-51 -

In 1951, there were 3 million handlooms and about 23,000 power looms (1.25.19) and the production of mill cloth, man-made cloth and yarn were 4338 million meters, 2743 million meters and 757 million kgs respectively.

National Textile Corporation Ltd (NTC) was incorporated in April 1968 for managing the affairs of sick textile undertakings, in the private sector, taken over by the Government, which increased from 16 in 1968 to 103 by 1972–73. These units were nationalized under the Sick Textile Undertakings (Nationalization) Act in 1974.

Textile Modernization Fund was introduced in 1986 with a corpus of Rs.750 Cr to promote modernization of textile industry, including private sector mills, As the response was encouraging, TMF was proposed to continue during VIII Plan. (8.v2.5.26.1 / 2)

Textile Restructuring Asset Trusts were formed for improving efficiency of textile plants.

Textile exports grew from Rs.35,478 Cr in 1996-97 to $ 12.10 billion in 2000-01. (9.5.240) (10.7.1.329)

Textile industry contributed about 14% to national industrial production and export (about 35% to total national export earnings) in 2001-02. (10.7.1.160)

Modernization of textile mills - Rs. 5057 Cr was sanctioned to 1232 proposals till 31.01.2002 under Technology Upgradation Fund Scheme for modernization of textile sector to enable them face competition from China, Taiwan, South Korea, Japan, etc. (10.7.1.165)

The turnover of textile industry in 2006-07 was US$ 47 billion and export US$ 17 billion. (11.7.1.314/317)

In 2011-12, textile sector contributed about 12% of manufacturing output, 11% of merchandise exports and employed about 45 million people. (12. Annex.13.2 – 70)

WOOL

In 2003, India had 61.5 million sheep, about 4.2% of world’s sheep population. (11.v2.5.68)

India was seventh largest producer of raw wool producing 1.8% of world production in 2006-07.

Export of wool items increased from Rs 3597.31 Cr in 2002–03 to Rs 4969.02 Cr in 2005–06. There were 718 wool units in organized sector and more in small-scale sector. (11.v2.5.71)

During 2002-07, Central Wool Development Board implemented Integrated Wool Improvement Program for unorganized wool sector aimed at improvement of wool fibre and breed; product development; provision of quality testing centre and Common Facility Centre for scouring, drying, carding, design development, product diversification, training and development of specialty fibre such as Angora and Pashmina. These programs covered 2.55 million sheep and benefited 55091 families up to 2006-07. (11.v2.5.72)

The size of woolen industry was Rs. 10,000 Cr., divided and scattered between organized and decentralized sectors. India had third largest sheep population in the world in 2011-12, 6.40 crore sheep producing 43.30 million kgs of raw wool, of which about 85% was carpet grade wool. (12.Annex.13.2 – 84/85)

It was estimated that raw wool production would increase from 114.2 million kg in 2008–09 to 260.8 million kg by 2019–20.

JUTE

National Jute Manufacturers Corp. Ltd. was incorporated on 3.6.1980 to take over the six jute mills taken over by the government.

In 1986, the Government announced a package of Rs.150 Cr Jute Modernization Fund and Rs.100 Cr Special Jute Development Fund, allowed duty free import of identified jute machinery items for modernization and made usage of jute packaging materials by specified end-users mandatory to compete with synthetic packaging material. (8.v2.5.27.1)

As government departments gave order for packing material to jute mills in accordance with Jute Mandatory Packaging Act, jute mills were not forced to undertake modernization or diversification. The jute sector was expected to achieve self-reliance through modernization and diversification. (12. Annex. 13.2 – 78)

COIR

India accounted for 90% of world’s coir production (Rs 1300 Cr in 2006-07) and its coir products were exported to about 90 countries across the world. (11.v2.5.90)

Coir Industry is mostly confined to Kerala, Tamil Nadu and Karnataka. Under Gram Sadak Yojana (Bharat Nirman), it was decided to use Coir geo-textiles for construction of rural roads in 9 States and to extend to all 28 States. (12. Annex. 13.2 – 104)

SILK

The production of raw silk increased from 2.5 million Ib to 3.6 million Ib between 1950-51 and 1960-61. (3.3.30)

India was second largest producer of silk in the world with 15.5% share in world production. (12. Annex. 13.2 – 80)

Meeting consumer needs for food products

Government departments and public sector enterprises like National Projects Construction Corp. Ltd., Hindustan Steelworks Construction Ltd., Water & Power Consultancy Services (India) Ltd., Engineering Projects (India) Ltd., etc. contributed for construction of dams and irrigation canals to supply water required for irrigation.

Fertilizers, pesticides and insecticides required for increasing production and yield of agricultural and horticultural products and protecting the crops were supplied at subsidized rates by fertilizer and chemical industries. (This is described in chapter 9).

Growth in production of some food products

SALT

The production of salt in 1950-51 was 2.642 Mts. This production was expected to be increased by 0.429 Mts with contribution from Mandi Salt Works and others in public sector during I 5YP.

Hindustan Salts Ltd. was incorporated on 12.04.1958 to take over the departmentally managed salt works at Kharaghoda (Gujarat), Sambhar Lake (Rajasthan) and Mandi (Himachal Pradesh) and make available quality iodized salt to weaker sections through Public Distribution System.

Sambhar Salt Ltd. was formed on 30.09.1964, as a subsidiary of HSL, to manage Sambhar Salt source.

The installed capacities in 2019-20 were 468 tons for Bromine and 7339 tons for Magnesium Chloride

Distribution of Food Grains and other Food Products

Central and State Warehousing Corporations provided for an addition of 2 Mts of storage capacity