STATE CHARACTER AND ECONOMIC POLICY 5 period and pioneers' risk—a prospect not ideal for the private entrepre-neur; (b) the investments would ultimately yield large benefits to particular industries or industrialization as a whole, but only a fraction of these would go back to' the original investor, that is, investments with heavy externalities; (c) even though indigenous capital in the post-colonial era was to a certain degree concentrated, as we shall see later, private capitalist groups were far too small to undertake such heavy investment and large risks even if they had wanted to do so. These limitations on the individual capitalists became a material constraint for the development of the industrial capitalist class as a whole. 'The state alone could break this 'isolation paradox' and establish the material preconditions for the development of the industrial bourgeoisie through investment over a wide front in infrastructure, social overheads and basic industries. Even a cursory reading of the public sector programmes of our five year plans, the Industrial Policy Resolution of 1956 and the expenditure programmes in the annual budgets will reveal that these are precisely the areas in which the Indian state has undertaken physical investment. It has established for the industrial capitalists the essential material pre-conditions for their development. This is why, as so many authors have pointed out, a large state sector was recognized as an instrument of support, not opposition, by the Indian capitalist class and private capitalists were among the most enthusiastic champions of the state sector in the National Planning Committee of 1938, the Bombay Plan of 1944, the Industrial Policy Resolution of 1948 and so on. T OTAL, PRIVATE TABL:AND PUBI E I .1C SECTOR 1 INVESTMENTS 5 Rs crores (1) (2) (3) (4) (5) Total Public Percentage Privatea Percentage Period Investment Sector Share of Sector Share of (2)in(l) (4)in(l) First Plan (1951-56) 3360 1560 . 46.4 1,800 53.6 Second Plan (1956-61) 6831 3731 54.6 3,100 45.4 Third Pla^ (1961-66) 10400 6300 60.6 4,100 39.4 Fourth Pla^ (1969-74) 22635 13655 60.3 8,980 39.7 Fifth Pla^ (1974-79) 47561 31400 66.0 16,161 34.0 Source: Pocket Book of Information, 1971 and Draft Fifth Five Tear Plan 1974-79 p 41. a This excludes transfers from public to private sector. b Targets.