Trends in Industrial Production THE r i s ing tempo of i ndus t r i a l

ac t iv i ty , wh ich was already apparent in 1954, continued d u r i n g 1.955. The figures of capacity and output published in this j o u r n a l ( for Engineer ing Industr ies last week and for Chemical and Other Industr ies this week) indicate a fu r ther movement in the direction of increasing u t i l i sa t ion of capacity. The star performer in showing an increase in output du r ing the year has been the steel structures indus­t r y , w h i c h recorded a 310 per cent increase in output: hut quite a num­ber of engineering industries showed increases of f r o m 50 to 100 per cent. Output of bicycles i n ­creased by 35 per cent, whi le t ha t of sewing machines increased by 25 per cent and of ba l l bearings by 11 per cent. As was noted last week, programmes for the expansion of output in those industries w h i c h neared or exceed-ed capacity are being fo rmula ted and in some cases have already been implemented.

I n d u s t r i a l development in I n d i a is also reflected in the increasing range of goods tha t are being pro­duced w i t h i n the count ry for the f irst t ime. D u r i n g 1955, a l te rna­tors, cycle dynamo sets, complete typewri ters , self do l l i ng ju te s i lver spinning frames, tea dryers, c l inker coolers and c l inker breakers, del i ­very valves and pump elements for fuel inject ion equipment, ve r t i ca l mul t i - cy l inder diesel engines, cer­t a i n sizes of d r i l l i n g machine, a l l geared head bench lathes and hy­podermic needles were among the products manufac tured in I n d i a on a commercia l scale for the f i r s t t ime.

New Commodities

Programmes for the manufac ture of new commodities, not produced h i the r to in the country, were ap­proved for jute m i l l machinery, capstan and tu r re t lathes, w i n d ­mi l l s , steam and diesel road rollers, a g r i c u l t u r a l t ractors , and automo­bile auxi l iar ies l i ke wheels and r ims , clutches and hydraul ic brakes. A c t u a l product ion of these items can, therefore, be expected to be reflected in the figures for 1956 or 1957.

An in teres t ing aspect of indus­t r i a l development is the increasing emphasis on the manufac ture of Indus t r i a l mach inery w i t h i n the country . Mach ine ry fo r the cot ton text i le Indus t ry la a l ready being

manufac tured here. D u r i n g the year there have been considerable increases in the output of ca rd ing engines, looms a n d r i n g frames, production h a v i n g doubled in re­spect of the last i tem. The output of looms, wh ich h a d shown a f a l l last year 'on account of the pre­sent restr ict ions on the ins ta l l a t ion of new automat ic looms', showed an increase this year. One wonders whether th is implies t ha t there has been a change of policy in this re­spect, or there is some other ex­p lana t ion of ei ther last year's f a l l in output or th is year's rise. This year's output of 2,636 looms is la r ­ger than the previous m a x i m u m of 2.086, reached in 1953, by 25 per cent; so some explanat ion ought to be offered.

The 1955-56 Report of the Min i s ­t r y of Commerce and I n d u s t r y points out t ha t the "jute text i le machinery indus t ry has been more or less established and in a few years' t ime, it is expected that the jute indus t ry w i l l cease to be depen­dent on impor ts in respect of machi ­nery." Steps have also been taken to develop the sugar. cement and p r i n t i n g machinery industry , whi le manufacture of the complete range of paper m i l l machinery, ear th-m o v i n g equipment and water tube boilers "is also receiving the at ten­t ion of the M i n i s t r y " .

Automobile Industry

A n i m p o r t a n t indus t ry wh ich showed a b ig spur t in product ion has been the automobile indus t ry . The number of automobiles produced increased f r o m 14,462 in 1954 to 23,084 in 1955. whi l e the number of f i rms decreased f r o m 9 to 8 and capa­c i ty f r o m 40,000 to 39,000. W h i l e the exis t ing anc i l l a ry industries showed substant ia l increases in out­put, programmes for new product ion of some i m p o r t a n t anci l lar ies l ike wheels and r ims, clutches and brakes, shock absorbers, o i l seals, gaskets and i gn i t i on coils were in the process of implementa t ion . Plans are also in prepara t ion fo r the r ema in ing i m p o r t a n t ancil laries l ike carburet tors , s tar ter motors and dynamos, s teering and dash­board ins t ruments etc. D u r i n g the current year, one un i t each f o r motor-cycles and scooters wen t in to product ion w i t h a capacity fo r 5,000 and 6,000, wh i l e ac tual out­put was 419 and 536 respectively.

I t appears t h a t there Is a heavy demand f o r diesel t rucks, and T a t a -

Mercedez-Benz have been given premission to double the i r capacity over the next three years. The demand for vehicular diesel engines for conversion of the exis t ing pet­r o l vehicles as wel l as for o r ig ina l equipment to chassis was also h igh , and the output of such engines was 3,875 in 1955 against a capacity of .3000. The only un i t in the f ield w h i c h came in to product ion in 1955 has thus been able to achieve more than capacity product ion in the very first year of i ts existence. M u c h of this is s t i l l assembling, of course; it is expected t h a t in a period of about 18 months, the entire engine less propr ie ta ry parts w i l l be manufac tured in Ind ia . A new u n i t has also been gran ted a licence to establish manufacture of another b rand of such engines w i t h a programme fo r complete manufacture in three years.

Ord inary diesel engines, w h i c h were facing considerable diff icul­ties in 1953, have also increased their output, though product ion is s t i l l f a r below capacity. The same applies to power-driven pumps. I t is ant ic ipated tha t diesel engines w i l l encounter considerable com­peti t ion f rom electric motors in the field of agr icul ture .

Significant Advance

Elec t r i ca l Engineer ing industries reflected the general condi t ion of industries d u r i n g the year. A m o n g the meta l lu rg ica l industries, the most s ignif icant advance was re­gistered by the a l u m i n i u m indus­t ry , output of ingot meta l increas­i n g f rom 4,900 tons to about 7,000 tons in 1955. The product ion of sheets, strips, circles and foi ls also increased f r o m 8,500 tons in 1954 to 11,000 tons in 1955. The exis t ing Instal led capaci ty of 7500 tons fo r ingot me ta l is completely inadequ­ate re la t ive ly to the demand fo r 20,000 tons at present, w h i c h is ex­pected to rise to 30,000 tons in a few years. Plans fo r add i t iona l capacity are, therefore, under pre­para t ion . A somewhat s im i l a r s i tua t ion prevails in the sma l l -sized steel castings indus t ry .

There has also been substant ia l expansion in most of the chemical industries, no tab ly in those pro­ducing soda ash, ca lc ium chloride, benzene, sulphur black, phosphoric ac id a n d sulpha drugs. N e w chemicals manufac tu red f o r the f i r s t t ime include Penic i l l in , a m ­m o n i u m chlaride a n d b i smu th .

470

THE ECONOMIC WEEKLY A p r i l 2 1 1 9 5 6

T H E E C O N O M I C W E E K L Y A p r i l 21, 1956

Output of sulphuric acid increased by 4 per cent to 156,000 tons, w h i c h is s t i l l only about 75 per cent of capacity; bu t add i t iona l capaci ty has been sanctioned in view of the importance of this chemical in the indus t r i a l i sa t ion of the count ry . Steps are also being taken to m a i n t a i n reasonable prices for the products.

F a l l in Output There have thus been substant ia l

increases in the output of most i n ­dustries and augmenta t ion of capa­c i ty du r ing the year fo r some. In others, plans for expanding capa­c i ty are under implementa t ion or consideration, w h i l s t in s t i l l others, these are under preparat ion. In spite of this general ly favourable picture of i ndus t r i a l product ion, output of a few industries has act­ua l ly fa l len . A case in point is the superphosphates indus t ry , whose output fe l l f r o m 105,056 tons in 1954 to 75,345 tons in 1956. Since th is has happened, when the S indr i f ac to ry shows f u l l u t i l i s a t ion of capacity for product ion of n i t r o ­genous fer t i l isers and impor t s have become necessary again, some ex­p lana t ion is necessary. The Min t s -t r y Repor t suggests t h a t th is f e r t i ­l iser ' though essential, does not give the same spectacular increases in y ie ld as nitrogenous fert i l isers ' , and the f a l l in a g r i c u l t u r a l prices caused a f a l l in i ts demand. I t

also suggests t ha t dufficulties of r a i l t r anspor t m a y have had something to do w i t h i t , w h i c h h a r d l y seems plausible, however i f the n i t roge­nous fer t i l isers indus t ry was no t affected.

Indust r ies in the engineering group w h i c h show a f a l l in output, though of v a r y i n g degress, include expanded metal , steel bel t lacing, chain l i n k fencing, boilers, hosiery K n i t t i n g and gramophone needles, reamers and tungsten carbide dies amongst tools, domestic refr igera­tors, brass and copper sheets, cir­cles, s tr ips etc., and zinc sheet str ips etc. Amongs t the chemical industries, A l u m i n i u m Sulphate, bleaching powder, ferrous sulphate, face powder, glazed tiles, magne­s ium chloride, wh i t e lead, zinc, chloride, crockery, l i g h t creasote o i l , road tar, azodyes, fas t colour salts, solubilised vats, stabil ised azoics, aureomycin, P A S and i ts salts, caffeine, ephedrine, b i smuth salts and calc ium gluconate show­ed a f a l l .

In some of the products men­tioned above, the f a i l is a l a r m i n g l y sharp. F o r instance, the output of caffeine f e l l f r o m over 5,000 lbs to less than 2,000 lbs and of Ephe­drine f r o m 732 to only 94. In both cases, present output is on ly a f rac t ion o f capacity. The M i n i s t r y Report gives an explanat ion fo r the f a l l in the output of caffeine,

but no t in the other cases. I t i s obviously very diff icult to pass any judgement w i t h o u t more detai led i n f o r m a t i o n w h i c h the M i n i s t r y presumably has in i t s possession. I t wou ld not be a bad idea i f the M i n i s t r y issued an annua l review o f indus t ry i n wh ich th is k i n d o f analysis of the successes and f a i l ­ures was made in detai l , whi le the M i n i s t r y Report i tself could be made in to a shorter and more busi­nesslike s ta tement of the ac tua l a c t i v i t y o f the M i n i s t r y du r ing the year. Such a review could then serve as a valuable supplement to the P l a n n i n g Commission's Pro­gress Reports, provided these have not themselves been dropped a l to­gether.

Reassessment of Capacity An interes t ing point wh ich emer­

ges inc identa l ly f r o m the Min i s t ry ' s Report is t h a t a reassessment of capacity is under w a y in a number of industries. This is brought out by the publ icat ion of the reassessed figures for some of the industries. This j o u r n a l has commented in the past on the u n r e l i a b i l i t y of capacity figures. I t w o u l d be desirable for the M i n i s t r y to indicate the basis on w h i c h i t i s proceeding in this task of reassessment of capacity, so t h a t the in te l l igent reader m a y be in a posit ion to understand its exact i m ­plications,