Aatmanirbhar India- A will-o’-the-wisp
Aatmanirbhar (a) Self-reliance is archaic in India and, indeed, one of the most prominent political principles in many post-colonial polities. Thus the critical question lately is, can India attain self-sufficiency? If Yes! It puts on the scope for other dilemmas like “what is self-sufficiency. Does it imply that we should cut ourselves off from trade dependencies on other nations or quit having trade ties and rigorously cling to the protectionist and Swadeshi principles?”
Although attaining self-sufficiency by blatantly separating ourselves from the other countries is practically impossible for any country. Even if we assume it could happen, it doesn’t aid India’s intentions, To be a regional power ensuring global cooperation and promoting the new global order. So what type of self-reliance is needed? Through what means it could be accomplished?
Before discussing its implications, Let’s understand how a self-sufficient economy would thrive, have we ever experienced this before?
Indeed yes! India had self-sufficient territories in erstwhile British India until the iron wheels of the railways put an end to it. Those were the days when distress at one part of the territory wouldn’t victimize the other. Now the whole earth is viewed as a global village. For instance, frictions in the Persian Gulf would result in the spurt of Crude oil prices, which would detonate the food inflation of other non-oil producing countries. Thus being wholly self-sufficient is preposterous.
Self-sufficiency and former adventures
Self-sufficiency has two implications, one being independent of other nations and second, would be discovering the economic opportunities within the territory. Perhaps the later kind of self-sufficiency would put the onus on focusing the internal features like enhancing the wicket for players vis-à-vis policymaking to perform well. The smarter way of achieving this would be even while pursuing self-sufficiency, it would be more opportunistic to aspire for the global market. Japan stands as an epitome of the success of this model.
Besides the earlier case of being independent and endeavouring to meet all our needs by ourselves would eventually end up in mediocrity in every aspect in the absence of healthy competition, as it is a sin qua non for every economy to be prosperous. The post-colonization era strived to be self-reliant, which resulted in license raj and the growing monopoly of private players in non-govt sectors in a protected market. A limited effort was made for upgrading technologies and contemporary consumer products. Thus the Indian market was stereotyped as low productive, expensive and was globally non-competitive.
As a result of all these India blatantly missed the train that steers to the 3rd industrial revolution, which incorporates electronic goods, microprocessors, personal computers, mobile phones, and decentralized manufacturing and global value chains during the so-called lost decade(s). Despite being the world’s 2nd largest smartphone market, we don’t possess any brands of our own. Therefore India’s reinvigorated attempt to be self-sufficient should be founded on the principles of being world-class. If we can build world-class, then why not the world scale?
Tweaking Jenga blocks from the bottom
The Feat of a self-reliant economy depends upon various firms as well as government policies. The first, object of the government would be to focus on the fundamentals right from the skill development of the masses to thwarting the brain drain by ramping up projects and opportunities for fostering, incentivizing R&D in strategic areas. Secondly, taking vital decisions that concern the preference of which industries should we focus on to become self-sufficient.
Skill development and intensifying R&D do have a notable role in improving our standards and qualities to satiate global demands. Even today, most R&D in India is conducted by PSUs. Further, only a modicum but the rising proportion of (private-sector) R&D is done by foreign firms in IT and biotechnology/pharma. Given the unwillingness of most of the private sector towards R&D and high-tech manufacturing, significant government reinvestment in PSUs and R&D is essential for attaining our arduous goal of self-reliance.
India’s niggardly public expenditure on education needs to be substantially ramped up, including in skill development. No country has achieved self-reliance without mass-quality public education. The atal innovation mission by NITI aayog kind of programs is crucial for implanting the custom of research amongst the scholars pursuing higher technical education, scaling up of employment opportunities. Research allowance mechanisms like CSR funding by corporates can be veered towards efforts by publicly funded universities, Indian Institutes of Technology, and national laboratories, which would also assist us in achieving the 2030 UN Sustainable development goals.
Diminishing the dependency
The second object that requires immediate action would be the selection of strategic areas where we can develop. Dependence on other nations in specific areas is not a bad thing if the dependence has low risks and is otherwise beneficial for the nation. Nevertheless, the role of government policies and assistance is vital for developing a favourable environment for achieving self-reliance. Moreover, the aspirations of firms also have a dominant part in this sport.
When it is evident that global demand for most products and services are much larger than the local market for the same, it is fascinating why Indian firms have not built businesses that have global aspirations. Perhaps they feel fortuitous to be in a comfort zone protected by patriotic, nationalistic slogans like “buy made in India”, these kinds of unforeseen clamours though has some merits of checking the trade deficit with countries like China thereby reducing the imports. It also has perils like aiding the Indian firms to develop a complacent attitude which leads to sluggishness and lethargicness.
Indian firms should adopt a “global in” view while building the strategy of a company. Do for India and sell outside opportunistically, as opposed to doing for the world and also sell in India. The later takes constant engagement over long periods to carve each foundation of the company.
The Charade
Recently, the policy maker’s has evolved an absolute belief on the approach of persuading foreign firms to set up their businesses in India, by reforming the labour and land laws conducive for them. This notion should be gradually jettisoned as it could thwart the needs for indigenous efforts towards attaining self-reliance. However, mere setting up of manufacturing facilities renders no guarantee of the absorption of technologies (the capacity to take them to higher levels independently). The major setback of self-reliance is, therefore, neither external finance nor domestic off-shore manufacturing, but valiant indigenous endeavour including R&D.
The drives like the “ Make in India ” or “Assemble in India” possibly could act as solace for the increasing unemployment and widening trade deficit. Well, this idea could be endorsed as a viable alternative by portending the evolution of some southeast Asian countries like Malaysia, Vietnam. They had focused on off-shore manufacturing lower down the value chain and without the impetus on self-reliance. As I enunciated earlier, it is useful for employment creation but is an inadequate paradigm for a country of India’s size and pretentious aspirations.
Way Forward
The self-reliant capabilities could be brought into fruition only by planned state investments in R&D including basic research (3–5% of GDP), technology and policy backing to private corporations, infrastructure also importantly, education and skill development (4–6% of GDP).
Unluckily, India may have floundered coping with the third wave of industrialization. Nevertheless still there exist lacunae for attaining self-reliant capacities in electric and fuel cell vehicles, electricity storage systems, solar cells and modules, aircraft including UAVs, AI, robotics and automation, biotech/pharma and others are well within reach.
Ultimately, among all the facets, a significant thing to be recognized is the benefits of all enhancements to citizens. The choice of crushing the labours by dwindling the labour laws is always alluring to improve the prevailing condition of an economy. The sustainable approach should be to close it on our own by establishing competitiveness that goes beyond low-cost labourers. We will be burying our own head in the sand if we constitute our competitiveness on the premise of earning less.
Views are personal.
