Since independence the Indian government has attempted to pursue a mixed
economic policy with features of both a free market and socialist planning. Major
industries such as railroads, automobile manufacturing, and banking are government run. At
the same time, many consumer-goods industries and agriculture are in private hands. The
center of the planned economy has been a series of five-year plans fostering state
takeover of the former British colonial economic structure. Under India's first prime
minister, Jawaharlal NEHRU, the plans stressed heavy industry, often at the expense of
agriculture. Today India ranks among the top ten industrial nations of the world and has
an increasingly powerful middle class (now numbering nearly 100,000,000), most of whose
members live in the largest cities. Despite significant economic growth since
independence, however, many of India's gains have been absorbed by the increasing
Manufacturing and Mining
Under British rule, industrial growth in India was inhibited. Since independence, however,
the country has achieved near industrial self-sufficiency. Today India produces most of
its own chemicals, automobiles, steel, textiles, and even computers and television sets.
Steel production has more than doubled since 1960. India is self-sufficient in iron and
coal but is heavily dependent on foreign oil.
India's chief energy sources are coal (26%), petroleum (49%), and electricity (25%). Some
156 billion kw of electricity were generated in 1987, which still far short of demand.
Only 65% of India's villages are electrified, and electrical outages are a common feature
of big-city life. The leading sources of power are thermal and hydroelectric. The
government has made a commitment to nuclear energy, which provides a little over 3% of
total power production.
The majority of Indians ear their livelihood from the land, and agriculture accounts for
about 35% of national income. About half of the land is arable, and two crops are normal
where water and climate permit. The chief summer monsoon (kharif) crops are rice and
millet. The major winter (rabi) crops are wheat and pulses. India is the world's second
largest rice producer and ranks fourth in wheat production. In addition to food crops,
commercial crops such as cotton, jute, sugarcane, tea, coffee, oilseeds, and tobacco are
grown. India is the world's leading producer of tea and sugar. The country also has the
world's largest cattle population, reflecting the revered status of the cow in Hinduism.
Although Indian cattle are poor producers, they still make India the largest Asian
producer of milk, butter, and hides.
The so-called GREEN REVOLUTION, which introduced new seed varieties and farming techniques
(including irrigation and the intensive use of fertilizers and pesticides) to increase
yields, has had a major impact on Indian agriculture since 1967. Total food grain
production for 1986 was 150 million metric tons (168 million U.S. tons), and India remains
self-sufficient in food production despite two recent monsoon failures. Wheat production
in Punjab and Haryana is the highest per hectare in the world. The effects of the green
revolution in rice production have been less spectacular, partly because Indians still
prefer the older rice varieties in their diet.
Theoretically, landlordism has been abolished, and there are ceilings on land holdings in
most states. Government attempts at land reform, however, have been largely circumvented
by the entrenched and politically powerful landlord class created by the British. The
traditional hereditary jajmni system, in which landless laborers exchanged their services
for food and other benefits, has eroded. In addition, the major gains of he green
revolution have accrued to large landowners with the capital to take advantage of the new
seeds and techniques. Poorer farmers are often unable to afford costly fertilizers and
lack access to irrigation systems. As village agriculture becomes increasingly mechanized,
more small farmers will lose their land to join the millions of landless migrants already
flocking to such cities as Calcutta, Bombay, and Delhi each year in a largely unsuccessful
search for employment.
Forestry and Fishing
Forestry and fishing account for only about 1.3% and 0.8% of the national income, but are
locally important in some states. Forests are not accessible for commercial development,
and the government is currently attempting to increase the forested area to 33.3% and
improve lumber output. Fishing is locally important in Kerala and in some deltaic areas.
Fish production has tripled since 1947 because of mechanization, introduction of deep-sea
fishing vessels, and better preservation and marketing techniques.
The volume of railroad passenger and freight traffic has increased greatly since
independence. Inland navigable waterways are also important avenues of transportation. Air
services now reach most large cities, and government-owned Air India is a regularly
scheduled international airline.
The government has fostered international trade and moved away from the export of
agricultural commodities and raw materials associated with the colonial economy toward the
export of manufactured goods. Major exports include cotton goods, iron, raw jute and jute
products, coffee, electrical goods, leather, handicrafts, diamonds, and chemicals. India
is now the world's largest importer of rough diamonds and exporter of gem diamonds. In
recent years India has also exported engineers and technicians (especially to the Middle
East) and thousands of medical doctors and nurses serving in hospitals in the United
States and Great Britain. The country's major imports are machinery, petroleum, chemicals,
cereals, copper, and zinc. The country's major imports include heavy machinery, petroleum,
copper, and zinc. As is characteristic of most recently independent nations, India has not
yet achieved a favorable balance of trade.