Hyderabad: The 'Inspector Raj' introduced by the then prime minister Indira Gandhi still exists in the system even though it started fading away after India embarked on the path of economic reforms in 1990s, Union Minister M Venkaiah Naidu said on Saturday.

"Soon after Independence, our first Prime Minister Jawaharlal Nehru, in his wisdom, had envisioned primacy for public sector to drive development in a nascent country. For her own reasons, Indira Gandhi amended the Constitution making socialistic development as our path of development resulting in the infamous 'Inspector Raj'," he said.

"Times then compelled us to take to the path of economic reforms in 1990s and our inexorable journey in this direction continues. All through, the welfare function of the state continued to be a guiding principle.

"The 'Inspector Raj' has begun to fade away, but it has not totally vanished," Naidu, who holds portfolios like Urban Development, Housing, Urban Poverty Alleviation and Parliamentary Affairs, said.

Inspector Raj refers to over regulation/supervision by Government of factories and industrial units, a practise which was rampant in 1970s and 1980s.


"For India to achieve its potential, we need to remove all hurdles that come in the way. Infrastructure development is the key in this regard. It is because infrastructure is the linchpin of economic growth as it can help in addressing other key issues, including employment, competitiveness and trade," he explained.