Context: The emphasis of the Prime Minister on a renewed drive for a self-reliant India has been perceived as a reaction to the new global realities, at the same time it seems as a throwback to nationalist economic policies.
More on the news:
- The nationalist economic policies were followed by India and other newly independent nations in the last century before the onset of Globalisation.
- India opened itself to the global market in 1991 through its policies of liberalisation, privatisation and globalisation, but remained cautious in its approach that at times helped it to remain unaffected from disruptive global headwinds.
- The hesitant approach of India to completely embrace globalisation often led to a clamour for faster and deeper opening of its economy.
- When the current regime took over, there was a renewed cry from global corporations and foreign governments for bolder reforms.
- Promoted localisation: But the government travelled the opposite course, i.e. raising fresh trade barriers and strengthening India’s manufacturing base through the Make In India initiative.
Limits and Inevitability of Globalisation
- The pandemic brought to the fore the limits and inevitability of globalisation.
- Countries such as the U.S. that relied on others for the supply of essential medicines and medical equipment were suddenly vulnerable.
- China’s unmatched leverage in global supply chains raised concern over weaponization of trade have prompted a renewed global discussion on the components of national security.
- On the other hand, this pandemic continues to illustrate how inseparably shared is the future of humanity, across national boundaries.
What Localisation may mean for India ?
- Return of Import substitution, an objective that drove nationalist economic policies in the 20th century.
- Profit-driven globalisation had brought to the fore multiple insecurities of countries.
- For instance, the biggest superpower’s struggles with procuring enough masks and paracetamol.
- Self-reliance is suddenly not a bad idea again.
- It does not mean a rejection of globalisation, but a call for a new form of globalisation.
- The global brands of today were sometimes also very local like this,they became global from (being) local.
- The PM elaborated further on India-led globalisation, on climate, on being helpful to other countries by offering them supplies in a time of crisis, aligning to the principle of Vasudhaiva Kutumbakam.
- India’s self-reliance can only be at the cost of China.
- The current crisis could work to China’s advantage further if it is business as usual.
- The Chinese grip over global supply chains has become a matter of concern for India.
- Reforms for self-reliance, not for globalisation.
- Policies to ensure that growth benefits the poor and the weaker sections and a frontal attack on corruption.
- Reform can be counted as the government’s ability to make cash payments to the poorest.
- If the list of reforms overlaps substantially with the demands of owners of capital i.e. rational tax system, simple and clear rules-of-law, good infrastructure, etc. then it should be carefully treaded as it might slant clearly towards national capitalists.
- To the extent that such politics brings succour to the disadvantaged, it is to be welcomed.
- If this is only a facade for majoritarianism or authoritarianism, it will bring more harm to the same people that this approach professes to protect.
- In the end, three pillars of Indian Economy should be catered to i.e. Small scale industries, farmers and labourers.
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