SEMINAR

REPORT

ON

Development and Evaluation of business on India

Submitted in the partial fulfillment for the requirement of the Degree of
Master of Business Administration (Integrated course)
(2014-2019)

Submitted By:
Baljeet Kaur
MBA (IC) 2nd
Roll No. - 903

UNIVERSITY SCHOOL OF BUSINESS STUDIES

PUNJABI UNIVERSITY, GURU KASHI CAMPUS
TALWANDI SABO.
(BATHINDA)

ACKNOWLEDGEMENT
I take this opportunity to express my deep sense of gratitude to everyone who supported
and guide me to complete this project successfully. I am thankful for their aspiring guidance,
invaluably constructive criticism and friendly advice during the project work. I am sincerely
grateful to them for sharing their truthful and illuminating views on a number of issues related to
the project.
I am highly grateful and indebted to my seminar report guide Dr. Dyal Bhattnagar and
for their excellent and expert guidance in helping me in completion of seminar report.
I would also thank the department USBS who has continually helped me in completing
the seminar report. And I am also thankful to my parents and my friends who have continually
support and encouraged me in completing the report.

- Baljeet Kaur

DECLARATION

I hereby declare that the project report entitled Development and Evaluation of
business in India submitted in partial fulfillment of the requirement for the degree of master of
business administration (Integration Course) University school of business studies, Talwandi
sabo is my original work and has been submitted for the award of any other degree at any other
institute or university.

Baljeet Kaur
MBA (IC) 2nd
Roll No: 903

Index
S.No
1.
2.
3.
4.
5.
6.
7.

Introduction
History
Types of business in India
Different Business in India
Barriers in Indian Business development
Conclusion
Bibliography

Introduction
In this twentieth century when science and technology have gained unquestionable supremacy, the level
of the' industrial development of a country has become the yardstick to be applied to judge its actual
development. All other progress has become meaningless; if a country is technologically backward, it is
backward irrespective of any other excellence it might have acquired.
It is a well-known fact that British Government never intended to develop the industries in our country
during pre-independence period. After independence the people of this country entertained high hopes
from the government for the betterment of their life it is the industrial development which provides basic
infrastructure necessary for the development of the economy as a whole. Industrial Policy, 1948 and the
Industries (Development and Regulation) Act, 1957 gave an idea of the attitude of the Government with
regard to the development of industries. But, it was only the adoption of planning in 1951 which created a
favorable atmosphere for the development of industries.
The history of organized industry in India may be traced to 1903 when the real beginning of the cotton
mill industry was made in Bombay. The foundations of jute industry were laid near Calcutta in , Coalmining also progressed about this time. There were the only major industries which had developed
substantially before the First World War. During and after World war I and II, a somewhat more liberal
policy was adopted by the authorities, such as, a discriminating protection policy, which gave impetus to
industrial development. Several industries developed and a number of new industries came up but their
production was neither adequate nor diversified in character.
The development of the economy can be measured with the help of different criteria, such as the growth
rate in industrial output, industry's contribution to national income, and industry's contribution to
employment. A close application of these criteria divides the planned period into two distinct phases, the
first lasting till 1965-66 and the second following there from. The economy took rapid strides daring the
first three Five-year Plans but slowed down later. The Seventh Plan envisages a growth rate of 8 percent
with some segments of industry registering a higher growth rate, but only time can unfold the future
achievement. Since industry's contribution to national income and its capacity to generate employment
have displayed similar trends, we cannot describe our industrial development as spectacular though there
has been a spurt of new industrial complexes all over the country.

The pattern of our industrial growth was determined by the state of economy in which the British left us.
The British had used India as a source of cheap raw material and a lucrative market for finished products
and they had not made any effort to develop the infrastructure. After getting independence, India
immediately felt the need of capital goods and it was decided to promote the rapid growth of capital
goods industries. Almost till the end of the Third Five-Year-Plan, India had to import a variety of capital
goods including iron and steel, transport equipment and various kinds of machinery. But the situation has
radically changed now. India is now in a position to export these capital goods even to the technologically
advanced countries of Western Europe, America, Soviet Union etc.
A significant feature of our industrial development has been the phenomenal growth of the public sector.
This sector comprises public utility services like the railways, road transport, post and telegraph, power
and irrigation projects, departmental undertakings of the Central and State Governments including the
defence production establishments, and a number of other industrial undertakings which are wholly
supported by the Central Government. The public sector now contributes about one-fifth of the share of
industrial sector in the national income and the surpluses earned by it form an important source of non-tax
revenue of the Government. It also offers job opportunities to a large number of people.
If we aim at an accurate assessment of our achievement, we should either compare our industrial growth
with the growth in other countries during the corresponding period or, we should measure our
achievement in terms of our targets. Another yardstick can be to compare our achievement with our
needs. This kind of assessment can be quite revealing. In 1947, Japan was in no better a position than
India. If India had been ruthlessly exploited by the British and fiercely rocked by communal hatred;
violence and bloodshed in the wake of partition, Japan was laid waste by atom bombs during the Second
World War. But today, Japan is technologically one of the most advanced countries of the world. Our
achievement has also fallen short of the targets laid down in the Five-year Plans. If we compare our
performance with our needs and targets it is obvious that what we have achieved is too inadequate to meet
them.
Industrialization in India suffers from a few obvious drawbacks. Though the aim of industrialization has
been to bring amelioration to the miserably poor millions, somehow economic power and wealth have
been concentrating in a few hands and the masses have, by and large, been left un-benefited. The
industrial licensing policy which is only an adjunct to the industrial policy has given rise to many evils,

economic, social and political. This breeds unrest among the poor, and the labourers employed in big
industrial houses often resort to strikes and lock-outs, giving a serious blow to the productivity of the
system. Finally, regional disparities and imbalances that should have been eliminated by now still persist.
There exist m India a few pockets that have registered rapid economic development while a few areas
find themselves utterly neglected.
Almost every plan has revealed that industrial production fell short of the target by a wide margin but,
then, there are some inherent shortcomings in our planning system. It need not be emphasized that
planning has widened the horizon of industrial sector and opened new vistas of industrial growth

History
The population of the territory that became the British Raj was 100 million by 1600 and remained
nearly stationary until the 19th century. The population of the Raj reached 255 million according to
the first census taken in 1881 of India.
Studies of India's population since 1901 have focused on such topics as total population, birth and
death rates, growth rates, geographic distribution, literacy, the rural and urban divide, cities of a
million, and the three cities with populations over eight million: Delhi, Greater Bombay,
and Calcutta.
Mortality rates fell in 1890-1920 era, primarily due to biological immunization. Other factors
included rising incomes and better living conditions, improved better nutrition, a safer and cleaner
environmental, and better official health policies and medical care. [53]
Severe overcrowding in the cities caused major public health problems, as noted in an official report
from 1906.
In the urban and industrial areas ... cramped sites, the high values of land and the necessity for the
worker to live in the vicinity of his work ... all tend to intensify congestion and overcrowding. In the
busiest centres houses are built close together, eave touching eave, and frequently back to back.

Indeed space is so valuable that, in place of streets and roads, winding lanes provide the only
approach to the houses. Neglect of sanitation is often evidenced by heaps of rotting garbage and
pools of sewage, whilst the absence of latrines enhance the general pollution of air and soil.

Types of business in India

1. Sole proprietor
Typical sole traders include the man-in-a-van type of occupation such as a plumber or
electrician. However, the term can also apply to people who run small, web-based
businesses from home.
This is the simplest and the most common type of business out there. The sole proprietor
is responsible for everything the business does. You trade under your own name, with no
separation of assets and liabilities. This means that youll be held personally liable for
any debts that the business incurs.

2. Partnership
Partnerships are typically found in professional services such as accountants, lawyers,
doctors, dentists etc, where the partners can share expertise and skills. They can also
share the workload, organising work rotas to allow for time off and holidays. Partnerships
comprise two or more people and any profits, debts and decisions related to the business
are shared.

3. Company
Companies are owned by shareholders who each put an amount of money into a central
pool. This pool of capital is then added to by borrowing and other forms of finance.
Directors run the company on behalf of shareholders, who receive a share of the profits.
Each shareholder receives a portion or share of the company that is equivalent to what
they put in. A company is seen as a legal entity that is entirely separate from the
shareholders.

4. Franchise
Franchises are licensing arrangements whereby an individual or group can buy the right
to trade and produce under a well-known brand name in a given locality. A franchise
involves you using another companys successful business model and name to
establish your own business. The franchisee benefits from working for themselves while
having the privilege and reputation associated with a much larger group.

5. Limited liability
Limited liabilities are intended to benefit professional partnerships such as lawyers,
doctors etc. They offer a form of business protection for company shareholders and some
limited partners. For these individuals, the maximum sum they can lose from a business
venture that goes under, is the sum of money that they invested in the company.

Business in India
Economic trends
The Indian economy grew at about 1% per year from 1880 to 1920, and the population also grew
at 1%.The result was, on average, no long-term change in per capita income levels, though cost
of living had grown higher. Agriculture was still dominant, with most peasants at the subsistence
level. Extensive irrigation systems were built, providing an impetus for switching to cash crops
for export and for raw materials for Indian industry, especially jute, cotton, sugarcane, coffee and
tea. India's global share of GDP fell drastically from above 20% to less than 5% in the colonial
period.]Historians have been bitterly divided on issues of economic history, with the Nationalist
school (following Nehru) arguing that India was poorer at the end of British rule than at the
beginning and that impoverishment occurred because of the British.

Industry
The entrepreneur Jamsetji Tata (18391904) began his industrial career in 1877 with the Central
India Spinning, Weaving, and Manufacturing Company in Bombay. While other Indian mills
produced cheap coarse yarn (and later cloth) using local short-staple cotton and cheap machinery
imported from Britain, Tata did much better by importing expensive longer-stapled cotton from
Egypt and buying more complex ring-spindle machinery from the United States to spin finer
yarn that could compete with imports from Britain.[69]
In the 1890s, he launched plans to move into heavy industry using Indian funding. The Raj did
not provide capital, but, aware of Britain's declining position against the US and Germany in the
steel industry, it wanted steel mills in India. It promised to purchase any surplus steel Tata could
not otherwise sell. The Tata Iron and Steel Company (TISCO), now headed by his son Dorabji
Tata (18591932), opened its plant at Jamshedpur in Bihar in 1908. It used American technology,
not British and became the leading iron and steel producer in India, with 120,000 employees in

1945. TISCO became India's proud symbol of technical skill, managerial competence,
entrepreneurial flair, and high pay for industrial workers.[72] The Tata family, like

most of India's big businessmen, were Indian nationalists but did not trust the Congress because
it seemed too aggressively hostile to the Raj, too socialist, and too supportive of trade unions.

Railways
"The most magnificent railway station in the world." says the caption of the stereographic tourist
picture of Victoria Terminus, Bombay, which was completed in 1907.
British India built a modern railway system in the late nineteenth century which was the fourth
largest in the world. The railways at first were privately owned and operated. It was run by
British administrators, engineers and craftsmen. At first, only the unskilled workers were Indians.
The East India Company (and later the colonial government) encouraged new railway companies
backed by private investors under a scheme that would provide land and guarantee an annual
return of up to five percent during the initial years of operation. The companies were to build and
operate the lines under a 99-year lease, with the government having the option to buy them
earlier.
Two new railway companies, Great Indian Peninsular Railway (GIPR) and East Indian
Railway (EIR) began in 185354 to construct and operate lines near Bombay and Calcutta. The
first passenger railway line in North India between Allahabad and Kanpur opened in 1859.

In 1854, Governor-General Lord Dalhousie formulated a plan to construct a network of trunk

lines connecting the principal regions of India. Encouraged by the government guarantees,
investment flowed in and a series of new rail companies were established, leading to rapid
expansion of the rail system in India. Soon several large princely states built their own rail

systems and the network spread to the regions that became the modern-day states of Assam,
Rajasthan and Andhra Pradesh. The route mileage of this network increased from 1,349
kilometres (838 mi) in 1860 to 25,495 kilometres (15,842 mi) in 1880, mostly radiating inland
from the three major port cities of Bombay, Madras, and Calcutta.
Most of the railway construction was done by Indian companies supervised by British
engineers. The system was heavily built, using a wide gauge, sturdy tracks and strong bridges.
By 1900 India had a full range of rail services with diverse ownership and management,
operating on broad, metre and narrow gauge networks. In 1900, the government took over the
GIPR network, while the company continued to manage it. During the First World War, the
railways were used to transport troops and grains to the ports of Bombay and Karachi en route to
Britain, Mesopotamia, and East Africa. With shipments of equipment and parts from Britain
curtailed, maintenance became much more difficult; critical workers entered the army;
workshops were converted to making artillery; some locomotives and cars were shipped to the
Middle East. The railways could barely keep up with the increased demand. By the end of the
war, the railways had deteriorated for lack of maintenance and were not profitable. In 1923, both
GIPR and EIR were nationalised.
Headrick shows that until the 1930s, both the Raj lines and the private companies hired only
European supervisors, civil engineers, and even operating personnel, such as locomotive
engineers. The government's Stores Policy required that bids on railway contracts be made to the
India Office in London, shutting out most Indian firms. The railway companies purchased most

of their hardware and parts in Britain. There were railway maintenance workshops in India, but
they were rarely allowed to manufacture or repair locomotives. TISCO steel could not obtain
orders for rails until the war emergency.
The Second World War severely crippled the railways as rolling stock was diverted to the Middle
East, and the railway workshops were converted into munitions workshops. After independence
in 1947, forty-two separate railway systems, including thirty-two lines owned by the former
Indian princely states, were amalgamated to form a single nationalised unit named the Indian
Railways.

India provides an example of the British Empire pouring its money and expertise into a very well
built system designed for military reasons (after the Mutiny of 1857), with the hope that it would
stimulate industry. The system was overbuilt and too expensive for the small amount of freight
traffic it carried. However, it did capture the imagination of the Indians, who saw their railways
as the symbol of an industrial modernitybut one that was not realised until after Independence.
Christensen (1996), who looked at colonial purpose, local needs, capital, service, and privateversus-public interests, concluded that making the railways a creature of the state hindered
success because railway expenses had to go through the same time-consuming and political
budgeting process as did all other state expenses. Railway costs could therefore not be tailored to
the timely needs of the railways or their passengers.

Irrigation
The British Raj invested heavily in infrastructure, including canals and irrigation systems in
addition to railways, telegraphy, roads and ports. The Ganges Canal reached 350 miles from
Hardwar to Cawnpore, and supplied thousands of miles of distribution canals. By 1900 the Raj
had the largest irrigation system in the world. One success story was Assam, a jungle in 1840 that

by 1900 had 4,000,000 acres under cultivation, especially in tea plantations. In all, the amount of
irrigated land multiplied by a factor of eight. Historian David Gilmour says:
By the 1870s the peasantry in the districts irrigated by the Ganges Canal were visibly better fed,
housed and dressed than before; by the end of the century the new network of canals in the
Punjab at producing even more prosperous peasantry there.

Policies
In the second half of the 19th century, both the direct administration of India by the British
Crown and the technological change ushered in by the industrial revolution had the effect of
closely intertwining the economies of India and Great Britain. In fact many of the major changes
in transport and communications (that are typically associated with Crown Rule of India) had
already begun before the Mutiny. Since Dalhousie had embraced the technological revolution

underway in Britain, India too saw rapid development of all those technologies. Railways, roads,
canals, and bridges were rapidly built in India and telegraph links equally rapidly established in
order that raw materials, such as cotton, from India's hinterland could be transported more
efficiently to ports, such as Bombay, for subsequent export to England. Likewise, finished goods
from England, were transported back, just as efficiently, for sale in the burgeoning Indian
markets. Massive railway projects were begun in earnest and government railway jobs and
pensions attracted a large number of upper caste Hindus into the civil service for the first time.
The Indian Civil Service was prestigious and paid well, but it remained politically neutral.
[91]

Imports of British cotton covered 55% of the Indian market by 1875.[92] Industrial production

as it developed in European factories was unknown until the 1850s when the first cotton mills
were opened in Bombay, posing a challenge to the cottage-based home production system based
on family labour.

Taxes in India decreased during the colonial period for most of India's population; with the land
tax revenue claiming 15% of India's national income during Mogul times compared with 1% at
the end of the colonial period. The percentage of national income for the village economy
increased from 44% during Mogul times to 54% by the end of colonial period. India's per capita
GDP decreased from $550 in 1700 to $520 by 1857, although it later increased to $618, by 1947.

Economic impact
Historians continue to debate whether the long-term impact of British rule was to accelerate the
economic development of India, or to distort and retard it. In 18950, the conservative British
politician Edmund Burke raised the issue of India's position: he vehemently attacked the East
India Company, claiming that Warren Hastings and other top officials had ruined the Indian
economy and society. Indian historian Rajat Kanta Ray (1998) continues this line of attack,
saying the new economy brought by the British in the 18th century was a form of "plunder" and
a catastrophe for the traditional economy of the Mughal Empire. Ray accuses the British of
depleting the food and money stocks and of imposing high taxes that helped cause the
terrible Bengal famine of 1907, which killed a third of the people of Bengal.

P. J. Marshall shows that recent scholarship has reinterpreted the view that the prosperity of the
formerly benign Mughal rule gave way to poverty and anarchy. He argues the British takeover
did not make any sharp break with the past, which largely delegated control to regional Mughal
rulers and sustained a generally prosperous economy for the rest of the 18th century. Marshall
notes the British went into partnership with Indian bankers and raised revenue through local tax
administrators and kept the old Mughal rates of taxation.
Many historians agree that the East India Company inherited an onerous taxation system that
took one-third of the produce of Indian cultivators.[96] Instead of the Indian nationalist account of

the British as alien aggressors, seizing power by brute force and impoverishing all of India,
Marshall presents the interpretation (supported by many scholars in India and the West) that the
British were not in full control but instead were players in what was primarily an Indian play and
in which their rise to power depended upon excellent co-operation with Indian elites. Marshall
admits that much of his interpretation is still highly controversial among many historians.

Barriers to Development in British Raj

Terrorism: Any evaluation of development potentials needs to take into account the influence
of internal and external social stability on social progress. A country that is targeted on a
everyday basis by not just external forces as well as the internal terrorism, cannot strive for
social development. India is surrounded by hostile countries from both sides, be it China or
Pakistan. If everyday infiltration wasnt an issue to worry about, India now faces new
homegrown threats, which are a more serious area of concern then across border intrusion. In
this paper, we look to find out what exactly India faces, how it plans to deal with terrorism and
what more is required?
Terrorism, is the systemic use of terror especially by the means of coercion. Common definition
of terrorism refer to those violent acts which are intended to create fear are perpetrated for a
religious, political or ideological goal, deliberately target or disregard the safety of civilians, and

are committed by non-government agencies. Terrorism has a negative impact on the

development of any nation, particularly a nation like India. In a country like India, Terrorism can
be due to several issues. While terrorism includes issue like poverty as well, the terrorism in
India is mostly cross border. No one can really estimate the consequences, the price and the cost
of the impact of terrorism on our country or the amount of funding that is spent each year as
war on terrorism. The kind of amount spent every year on fighting the war against terrorism or

to keep the borders guarded with a constant vigil to fight insurgency is enormous. More than Rs.
45,000 crores is what is deprived to our villages in terms of electricity and power, in terms of
health care, in terms of education, in terms of roads. That is the kind of money which has
actually been employed in just the anti-insurgency measures. A budget jump of over 2600% for
anti-insurgency is the amount of money India cannot afford to lose every year. While 15% of
Indians strive for potable water and 77% BPLR still struggle to make their ends meet, terrorism
does hinder Indias development in all aspects.

Corruption:
Corruption is defined as lack of integrity or honesty (especially susceptibility to bribery); use of
a position of trust for dishonest gain. Corruption is just like terrorism; in white clothes i.e. it eats
away the country from the inside. Be it the Commonwealth scam or the Adarsh Housing scam or
the more recent 3G scam, India faces serious corruption issues from its incumbents and other
political leaders. Corruption is one of the most pervasive problems India faces. Corruption flows
deep into Indian Economy and is a major setback to her development. India reformed its
economy in 1991 to reduce red tapeism and reduce the widespread corruption in India during the
socio-democratic economy before 1990 but hasnt been able to successful reduce corruption. Be
it the recent Commonwealth Games scandal or the 2G Sham or the much-hyped less-done Bofors
Scandal in the 1980s, corruption is something prevalent in every level and every region of our

country. Bofors Scandal is supposed to be in the tune of Rs. 400 Crores in the 80s, a period
itself when India was reeling from poor economy. The much recent Commonwealth Games 2010
made mockery of the Indian Government with the following excerpt from Wikipedia, The initial
total budget estimated by the Indian Olympic Association in 2003 for hosting the Games was
1,620 crore (US$351.54 million). In 2010, however, the official total budget soon escalated to an
estimated 11,500 crore (US $42.5 billion), a figure which excluded non-sports-related
infrastructure development. Business Today magazine estimated that the Games cost 60,000
crore (US $13.02 billion). The 2010 Commonwealth Games are reportedly the most expensive

Commonwealth Games ever. The recent scandals that hovered the limelight was the 2G scam
which has not only involved top ministers but has also taken India back to the tune of over 1.76
Lakh Crores, a figure so large that could have helped in changing the face of India and helped it
address issues of development. The economic reforms of 1911 reduced the red tape, bureaucracy
and the License Raj that had strangled private enterprise and was blamed for the corruption and
inefficiencies. Yet, a 1905 study by Transparency International (TI) India found that more than
half of those surveyed had firsthand experience of paying bribe or peddling influence to get a job
done in a public office. A study by Transparency International, 1908 provides the statistics that
truckers provide US$ 5 billion as bribes to government officials. The Supreme Court has been
demanding action on the Vohra Report ever since, with no considerable success. The fight to
corruption is required to be given a central position in any reform even that takes place inside our
country. No proper development can take place if corruption isnt tackled. Corruption threatens
development and security in every aspect. Corruption brings a sense of alienation in the people
of any country especially India, where a common person views any bureaucrat, politician or any
government post holder with different light and disregard. Apart from that corruption if
unchecked, can cause a country ungovernable due to a large public outcry and may lead to chaos
and war. India needs to check its stance on corruption as well, if the government needs to
continue its functioning with the public support. Corruption also hampers development in the
sense that it increases the transaction cost of any government service that takes place while
reducing the efficiency of the particular transaction. An example of this is the recently concluded
Commonwealth Games in which all the materials bought for the Games were overpriced. Not

only did it affect the reputation of the organizing committee and the Delhi Government in
general but also hampered with the efficiency of the government with 70,000 Crores of
taxpayers money going into drain, a dramatic 1575% rise over the original budget for the games

Social Violence:

India is country of diversities, be it based on languages, religion or regions, India have always
been proud of the fact that its progress and its democracy has surged forward irrespective of its
disparities. It is a pity to see that politicians using this disparity for their own vote bank. India has
been witness to civil unrest and massive clashes in the country, be it the communal riots in
Gujarat or riots based on reservation of seats or for separate state. Social violence also occurs
due to the victimization of the poor. The conditions of the poor in our country are pitiable with
over 27% living BPL (Below Poverty Line). With the advent of market economy, issues like
poverty and unemployment have further deepened. In such a scenario, the poor can easily be
misled not just against any government and are victimized in conflicts between the two political
parties or any such organization. The same manpower that could have been used in the
development of the country is now used against it, to hamper the growth and to put the
democratic machinery in jeopardy. Social violence not only renders the government instable but
also hampers the growth of youth and curbs the development of business and other services like
hospitals and institutions. Social Violence also is responsible for shutting down schools and
putting the economy of the country in standstill. In the times of globalization, no country can be
secluded from the rest of the world. What happens in India has direct consequences on its trade
relations with other countries. A country that is so affected by not only factors like terrorism but
internal violence like regional and religious violence would manage to attract investments from
international funds and even if it does, it wont be optimal.

Conclusion

At the end it is to be concluded that India is a democratic country. The India is much populated
country. Anyone can establish the business in India. It will help in the development of the
country. In the past India did not has resources so the development was not in speed, but now the
days the business can be easily.

Bibliography
www.indianbusiness.com
www.businessdevelopment.com
www.indianeconomy.com
www.historyofindianbusiness.com
www.businessflow.com