We present an analysis of the issues that have influenced the development of informatics policy of India. Factors such as impact on employment, trade, and foreign exchange have acted as constraints in the adoption of information technology (IT). At the same time, IT presented a significant opportunity for accelerating progress towards meeting India's goals of self reliance and faster economic development. IT was also viewed as necessary for India's strategy of development, which is based upon centralized planning and management of the economy. We also discuss the role of potential demand for computer systems, the existing industrial base, R&D infrastructure, availability of technical manpower, and regulations for import, foreign investment, and licensing in determining the policies for indigenous manufacture of computer systems. We conclude with a discussion of India's informatics policies and experience in implementing them.