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List of Industries left for Licensing in India

Hemant Singh25-JUL-2018 16:14
Industrial Licensing in India

India is striving for Industrial development of the country soon after the independence in 1947. In the New Industrial Policy of 1991; only 17 sectors need license to start industrial operation; which further reduced to just 13.

Since the inception of the New Economic Policy in 1991; India opened most of the industries for the private players. As of now industrial licensing has been abolished for all industries except five. This article is publishing the name of the industries where licensing system still continues.  

Main objectives of Industrial Policy of India are:

1. Maintain a sustained growth in productivity

2. Enhance gainful employment

3. Achieve optimal utilisation of human resources

4. Attain international competitiveness

5. Transform India into a major player and partner in the global arena

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Name of the industries reserved for the license is as follows;

1. Electronic aerospace and defence equipment, all types.

2. Specified hazardous chemicals i.e. i. Hydrocyanic acid and its derivatives, ii. Phosgene and its derivatives, iii. Isocyanates and disocyanates of hydrocarbon not elsewhere specified (methyl isocyanate).

3. Industrial explosives, including detonating fuses, safety fuses, gunpowder, nitrocellulose and matches.

4. Cigars, cigarettes of tobacco and manufactured tobacco substitutes.

5. Distillation and brewing of alcoholic drinks.

Note: Powers for regulation of potable alcohol have been vested with the states as per Supreme Court decision in 1997 in line with the constitutional provisions.

In the FY 2014, government has notified that what would be called defence equipment. The initial validity for industrial license for all sectors was extended to 3 years with a provision to grant 2 extensions for two years each. So the total time for validity of industrial license for commercial production of the defence equipment is 7 years.

Hence these were the crucial industries where license is still mandatory before starting the commercial production of the defence equipment in India.

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