Assertion: Savings and investments were growing during the Second Five-Year Plan in India.
Reason: A bulk of industries like electricity, railways, steel, machinery, and communication was developed in the public sector during the Second Five-Year-Plan.
Answer & explanation
Correct answer: option 1
Before the Second Five-Year Plan was finalized, the Congress party at its session held at Avadi near the then Madras City, passed an important resolution. It declared that a ‘socialist pattern of society’ was its goal. This was reflected in the Second Plan. The government imposed substantial tariffs on imports in order to protect domestic industries. Such a protected environment helped both public and private sector industries to grow. As savings and investment were growing in this period, a bulk of these industries like electricity, railways, steel, machinery, and communication could be developed in the public sector.