India was not in favour of the two known paths of development. Also it did not follow the capitalist model of development. In this, development was left entirely to the private sector, nor did it accepted the socialist model in which private property was abolished and all the production was controlled by the state. Elements from both these models were taken and mixed together in India. That is why it was referred to ‘mixed economy.’
Much of the agriculture, trade and industry were left in private hands. The state controlled key (heavy) industry provided industrial infrastructure, regulated trade and made some crucial interventions in agriculture. A mixed model like this was open to criticism from the both sides-the left and the right.
Some critics argued that the planners refused to provide the sector with enough space and the stimulus to grow. The enlarged public sector produced powerful vested interest that created enough hurdles for private capital especially by way of installing systems of licences and permits for investment. The policy of state restricts import of goods and could be produced in the domestic market with little or no competition left the private sector with no incentive to improve their products and make them cheaper.
There were critics who pointed out that the state did not spend any major amount for public education and health care. The state intervened only to those regions where the private sector was not prepared to go. Hence, the state helped the private sector for making profit.