India is ranked fifteenth among the nations of the world in terms of its industrial output. Production has increased at an average growth rate of approximately 5 percent per annum during 1970-1985. While most industries have contributed to this expansion, the growth has been particularly significant in chemicals, metal products, electronics and electrical machinery, transport equipment, petroleum products and power generation. Although the last three Five Year Plans have called for a spatial dispersal of industries and a diversification of products, neither the industrial progress nor the dispersal efforts are reflected in Punjab's development experience. In fact, extensive research on Punjab's current industrial capacity and its historical evolution has highlighted its unsatisfactory performance relative to other states of the Indian Union. 1