Merging Local With Global (9 September 2020)
Merging Local With Global (9 September 2020)
Why in News:
Prime Minister Narendra Modi last week said 1.3 billion Indians have embarked on one mission -- to create an "Atmanirbhar Bharat", which seeks to merge the local with the global and ensure the country's strengths act as a global force multiplier.
"Time and time again, India has shown that our goal is global good," said PM Modi in his special keynote address at the third leadership summit of the US-India Strategic Partnership Forum via video conference. Pitching India amongst the best investment destinations worldwide, the PM said the country's political stability and policy continuity makes it the best place for global investors looking for attractive business opportunities during the COVID-19 pandemic.
US-India Strategic Partnership Forum (USISPF) was established in 2017 for focussing on the partnership between India and the US.
Its purpose is also to enable businesses and government to collaborate and create meaningful opportunities that can positively change the lives of citizens
In 2019, overall USA-India bilateral trade in goods and services reached USD 149 billion.
Summary of the Debate
US-India Strategic Partnership Forum (USISPF):
- USISPF is an independent not-for-profit institution dedicated to strengthening the U.S.-India partnership.
- It is a week-long discussion on navigating new challenges and enhancing the economic and strategic partnerships between India and the United States.
- The summit titled ‘US- India Navigating new challenges’ and was set to discuss the roadmap for India- US energy Partnerships, areas of Indo- US bilateral cooperation including trade and investment, strategic energy collaborations, ties in fintech, healthcare, technology, and India’s position in the global supply chain.
Key Highlights of the Summit:
- In the forum PM tell the international audience and the investor that India have handled the covid-19 situation very well and have taken care of poor people. Giving this bright picture of emerging India, in India PM talks of vocal for local but now he was talking of merging local with global and making an invitation to foreign investors.
- The forum also talked about the recent transformation of the world and how this requires India’s bolder relationship in the neighbourhood and a bigger footprint in the world.
- According to the forum estimates, India-US bilateral trade is projected to grow to 238 billion dollars by 2025.
- The forum discussed about how India is promoting policies that would incentivize investment and working together in both countries towards building a mutually beneficial relationship.
- The next part covered up India’s policy of “Atmanirbhar Bharat”, a more self-reliant India, a program to increase its national manufacturing capacity.
- The most important is cost of doing business, which is very high in India. It’s not just ease of doing business because when someone is looking at putting his money, he’s seeing where he gets the biggest bang for his buck and therefore a lot of investment has been going to Vietnam, to Philippines and even to Bangladesh. We have had some success with Foxconn which has come in and making some number of Apple phones in India. So, India have to address the cost of doing business and this involves very high cost of finance even though our interest rates have come down they are much higher than global interest rates.
- The cost of land which is very painful process to put together because the land is in parcels.
- The cost of electricity in the industry is high because consumers are cross subsidies and keep industry tariffs very high and consumer tariffs low. But in all over the world, it is reverse, where industry tariffs are lower than consumer tariffs foster industrialization.
- These makes the cost of production in India higher and less competitive than other global destinations.
- For making a balance between local and global, the policies should not be only for FDI, they should be for all investment, domestic and foreign which creates jobs and capacities, which sets up manufacturing facilities in India.
- Industrial parks should be set up and it should be open to domestic investors to invest as well as foreign investors.
- India is need to look on intelligent government regulation which would provide an incentive to set up capacities in India rather than supply from outside.
- The partnership between the centre and states need to be strengthen and well equipped intellectually and in terms of skills, bureaucracy and civil services.
Important points made by the Guests
Ashok Tandon, Senior Journalist
Meera Shankar, Former Ambassador
Shakti Sinha, Director, Delhi School of Public Policy & Governance