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New Delhi, 4 June 2025
‘Refuse Foreign Goods’
BETTER INDIAN QUALITY
FIRST
By Dhurjati Mukherjee
The Prime Minister, Narendra Modi recently exhorted
Indians to strike out foreign goods from their lives, seeking to keep the flame
of ‘Operation Sindoor’ burning by dovetailing it to his government’s push for
self-reliance. He further stated that if we want to build a developed India by
2047and take our economy from the 4th to the 3rd
position, we will not use foreign goods. Modi wanted traders across the country
to take the pledge, no matter how much profit they make by selling foreign
goods.
This observation made while addressing an event
at Gandhinagar during a two-day visit to Gujarat last week, by Modi is noteworthy
as it may remind people of the pre-independence Gandhi-Tagore controversy
regarding boycotting foreign goods. There are two things that need to be
analysed in this context – one, do we produce goods that stand up to global
standards and secondly, whether India can do without using foreign goods. It
appears that what Modi implied is that we should give top priority to
India-made goods and, in cases where this is not possible, we should go for
imported items.
Analysts believe that there was an indirect
reference to China, but questions arise about what consumers would do regarding
electronic items which, in some cases, have no comparable Indian substitutes.
Not just electronics but there are many sophisticated equipment and appliances
in various sectors that are foreign and are essential for different purposes.
Indian manufacturing needs to be given a boost,
and as pointed out by the Prime Minister this would get an impetus when increasing
number of Indian products are used locally. It needs to be pointed out here
that the government should ensure improvement of the quality of the products
and give impetus, if necessary, at their upgradation. In this connection,
recent reports of medicines produced by government agencies, being spurious
does not augur well for the people and the Prime Minister’s plans.
Whether Modi indicated that with India having
a large domestic market, this would also motivate foreign investors to come to India
also needs serious thinking. Take for example the case of Suzuki, whose cars
and motorcycles, produced jointly with Maruti, have been a huge success.
Similarly, if Apple starts manufacturing I–phones in India, the huge domestic
market will definitely absorb a significant portion of these items.
It cannot be denied that for a large and
diverse country like India, there is a need to spread the manufacturing base
throughout its length and breadth. Obviously, for this a plan is critical with
year-wise targets though various incentives have been dished out to motivate
entrepreneurs. Even then, small manufacturers find it rather difficult to get
loans from banks while also facing problems of fast transportation, storage
etc. These need to be looked into to motivate small and medium entrepreneurs to
expand their business and become profitable.
It is, however, distressing to note that Foreign
Direct Investment (FDI) declined by 97 per cent to $353 million during the last
financial year (2024-25), reportedly due to largescale repatriation out of the
country, driven to an extent by overseas investors such as Hyundai cashing out
through initial public offers. The government has been trying to push FDI into
the country as it seeks to tap into growing appetite among global investors to
diversify beyond China. But reports indicate that companies are opting to
invest in countries such as Vietnam, Indonesia and Mexico. The challenge for
India to attract foreign investments is indeed quite tough but only time will
tell whether the country would succeed.
While the Prime Minister has rightly
maintained India is destined to become the fourth largest economy by end 2025,
experts believe that now is the time to place ourselves among the most powerful
economies with transformative reforms. As mentioned, what is most vital is
making borrowing easy for small and middle-level entrepreneurs and making more
resources available with MSMEs. Another important aspect is that high tariffs
on critical inputs, particularly in electronics and machinery need to be
checked to boost up manufacturing, specially keeping in view where is an
inclination to import and use foreign goods.
The thrust on infrastructure has been
continuing but the government should try to bring private investment in the
infra sector, which unfortunately is missing. Addressing a Confederation of
India Industry (CII) event, the Chief Economic Adviser, V. Ananth Nageswaran
rightly pointed out that the increased investment would not only enhance capacity
but also create more jobs at greater remuneration, leading to an increase in
household savings. He regretted the private sector witnessed a profitability
growth of four times from Rs 7.2 lakh crore to Rs 28.7 lakh crore as of March 2024,
but the capital formation grew only three times in the second decade.
The other key area is the need for emphasis
on R&D where unfortunately the private sector is not giving adequate
attention. There is need for the Centre to ensure tying industry with
research institutions so that the latter could redress their problems and come
out with innovative solutions. These need to be considered urgently to boost
Indian manufacturing, specially in new areas and make our country’s products
more acceptable to the people here and increase the export potential.
Meanwhile, it is good to hear that the
country remains the fastest growing economy at 6.5 per cent GDP growth globally
even as the global economic outlook for 2025 and 2026 remain clouded by
multiple challenges, both political and economic, as per the recently released
Reserve Bank of India report. The high growth in manufacturing in the last
quarter of FY 25 should help improve the quality of Indian products and
services.
India has a rather strong economy supported
by revival in consumption demand with the government’s continued thrust on capital
spending while adhering to the path of fiscal consolidation, healthy balance
sheets of banks and corporates. However, the thrust should now be on improving
the quality of Indian goods and make them quality-centred and competitive in
meeting global standards. Then the country’s population would be motivated to
buy them in the coming years and fulfil the Prime Minister’s dream.---INFA
(Copyright, India
News & Feature Alliance)
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