Comment by jeswin
15 days ago
> The Make in India policy of the present government is reminiscent of the pre-1991 inward-looking Indian state.
Have you seen the 70s or the 80s? I was a child during the 1980s when India was a socialist state. There were very few private enterprises, because there was absolutely zero government support. Taxation peaked at 90% during the early 1970s under Indira Gandhi, who also nationalized many of the largest private companies - because private enterprise was seen as a bad thing. It was also impossible to bring in foreign investment, because that would come with profit motives.
Basically, the comparison you're drawing is not really accurate. The current Make in India plan is very similar to the US bringing in strategic manufacturing back into the US; a plan which has had bipartisan support (for example, the CHIPS Act). It incentivizes businesses (including foreign companies) to set up manufacturing units in India. And is quite the opposite of what was happening during India's socialist era.
>It incentivizes businesses (including foreign companies) to set up manufacturing units in India.
That type of protective policy works for India in incentivizing manufacturers to come build locally because Indian labor is still dirt cheap and the government will work with you to give you what you need without the pesky nimbyism, environmentalism, etc getting in the way of factories. US is not in the same case.
India can grow at 10% but import substitution policy could hurt that, Arvind Panagariya says https://theprint.in/theprint-otc/india-can-grow-at-10-but-im...
From the article:
> Even though Make in India is not a classic import substitution case, it aimed to reach that end.
So it's not really import substitution. But let's ignore that article, it's not a serious piece anyway.
A key idea of Make in India is to make and export - which means that unlike socialist-era import substitution (via tariffs and permissions), the ones which aren't good enough will fail fast and cheap. It won't lead to people driving HM Ambassador cars for 40 years.
Whether Make in India will succeed or fail is a very different matter, of course.