SOAS Research Online

Abstract

Since 1971 the Government of India has had a policy of encouraging the dispersal of industry to designated rural backward areas. The thesis attempts a critical assessment of this industrial location policy. It questions the extent to which the industrial dispersal that has occurred during the 1970s is simply a result of the policy or whether it was primarily prompted by other factors such as the interests of Indian industrial capital. The thesis starts with a review of industrial location theory and policy, from which it concludes that industrial dispersal and the developmental impact of industrial growth poles can usefully be analysed in terms of modes of production theory. It is argued that one of the most important features of such industrial growth poles in a Third World context, is that they represent the organised penetration of the capitalist mode of production into areas which previously are in general characterised by pre-capitalist modes. The next two chapters of the thesis examine the genesis of Indian industrial location policy and the evolving relationship between the Indian state and industrial capital. They conclude that while in the past the Indian state has imposed restrictions on industrial capital, these have become less stringent since the raid 1960s. It is argued that the industrial dispersal policy with its package of financial incentives for industrialists is itself part of a new, much broader development planning ethos. An ethos which replaces the old emphasis on state led development with the view that development will result from the efforts of private enterprise helped by the state. The third section, again comprising two chapters, takes the analysis down to the level of an individual State: Tamil Nadu. The distribution and development of industry in the State is discussed and the efforts of the State Industrial Promotion Corporation of Tamil Nadu in implementing the dispersal policy is analysed. This is followed through into the final section where the behaviour of firms locating in the two Tamil Nadu growth poles of Ranipet and Hosur is examined on the basis of material from a questionnaire survey. The types of firms involved are described and the managers' reasons for choosing the sites are analysed. The survey results demonstrate the validity of the initial hypothesis, to the extent that a certain specific section of the survey firms chose their new dispersed locations for reasons other than government policy. In addition it is suggested that the incoming firms will have both a disruptive and developmental impact on the local economy of the Ranipet and Hosur areas. While their advent will be of benefit to some it will have a particularly harsh negative effect on the lives of the many local inhabitants with no access to the jobs and incomes generated by the new industry. These points are drawn together and summarised in the concluding chapter.