-SURAJ CHATHLINGATH (CONTRIBUTOR)
“At least don’t buy Ganesha idols from China,” marks Foreign Minister, Nirmala Sitharaman while emphasizing upon the narrative of self-reliant India under the ‘Atmanirbhar Bharat Abhiyan’ scheme and the importance of decreasing dependence on China. The scheme was first mentioned in May 2020 when Prime Minister Narendra Modi rolled out an economic package of Rs.20 lakh crores under the tag ‘Atmanirbhar Bharat Abhiyan’ to spur economic growth during COVID-19 pandemic. Since then, decisions like changing the definition of MSMEs, increasing FDI in the defense manufacturing, and encouraging private participation in many sectors have taken place under this tag. As per Prime Minister Narendra Modi, the Atmanirbhar Bharat scheme envisions India to be a self-reliant and identified economy. In his address, he said, “India’s self-reliance will be based on five pillars – economy, infrastructure, technology-driven system, vibrant demography and demand.” The economic package announced in May will play an important role in boosting this vision of self-reliance, according to the Prime Minister.”
On 25 September 2014, the NDA government, then on its first term, came up with the ‘Make in India’ movement which was aimed at wooing both domestic and international companies to make their products on Indian soil, thereby increasing India’s manufacturing potential and decreasing the gap in dependence upon other countries, particularly China. The ‘Make in India’ movement came under the Ministry of Finance and covered up to 25 sectors of the Indian economy. As a result, India received foreign direct investments, FDI worth $60.1 billion in 2015, surpassing the United States and China as the top global destination for foreign direct investments. The Atmanirbhar Bharat Abhiyan announced in May 2020 is more like a clear picture of the otherwise old ‘Make in India’. According to the Make in India website, “the entire scheme of Atmanirbhar Bharat focuses on providing impetus to the Make in India initiative and transforming local Indian companies into global brands.”
Atmanirbhar Bharat scheme can strengthen the Make in India initiative, and attract investments by enhancing the ease of doing business. The special economic package announced under Atmanirbhar Bharat Abhiyan will be assisting many critical sectors like MSMEs and cottage industries. In between all this, the target for a $5 Trillion economy is always held high, especially by the Prime Minister, repeatedly using it twice when he was speaking about the five pillars of self-reliant India. Infrastructure is yet another significant area, and developing it in every sector to support such rapid growth is of utmost importance. It is estimated that more than Rs 100 crores will be invested in this process over the next 5 years. Along with economy and infrastructure, systems based on 21stcentury technology, vibrant demography, and demand utilized to its full potential are the other pillars that the Prime Minister have envisioned as essential for a self-reliant India.The Five Pillars of Self-Reliant India | Source : Vajiram IAS
The success story of the Atmanirbhar Bharat scheme, though, depends mainly on how companies and investors react to this. Considering the population advantage that India has, and the availability of skilled labour for a minimum wage, it is already an irrigated land for seeding self-reliance. The various reforms announced by the government are simply aiming to provide a more fertile soil for investors to cultivate on. It is not just about big businesses, the welfare of common citizens too is an agenda under self-reliant India. Pradhan Mantri Garib Kalyan Package among the many reforms assures insurance coverage of Rs 50 Lakhs for health workers, and free wheat, rice, pulses, and many more for households to support them amidst the pandemic. Rs 2000 each are to be paid to farmers under PM-KISAN Yojana. Free gas cylinders will be provided to 8 crore poor families for the next three months. MNREGA wage is being planned to be increased from Rs 182 a day to Rs 202 a day, which is to benefit 13.62 crore families. Construction workers can acquire relief funds from their construction workers welfare fund. 3 crore poor widows, poor senior citizens will be given Rs 1000. The collateral-free lending limit for Women Self Help Groups has to be increased from Rs 10 to Rs 20 lakhs, which will surely be helpful for 6.85 crore households benefiting from such groups.
Collateral-free automatic loans for MSMEs have been announced to help them restart their businesses during this pandemic. Borrowers with Rs 25 crore outstanding credit and Rs 100 crore turnover are eligible to acquire 20 percent loan of outstanding credit in an emergency credit line. This along with other reforms like Rs 20000 crore as subordinate debt for stressed MSMEs, equity infusion for MSMEs by setting up of Fund of Funds, and prohibiting global tenders to be in government procurements up to Rs 200 crore, can help Indian businesses to scale up.
The recent clashes in Galwan valley in Ladakh between Indian forces and Chinese PLA, and the related anti-China sentiments in India are further adding momentum to this self-reliance campaign. Political parties and common people alike are urging for the boycott of Chinese commodities and to replace them with domestic products. It is still a challenge to achieve this, considering Indian manufacturers lag behind Chinese companies in quantity and quality in many critical sectors, especially consumer electronics like smartphones and laptops. This gap between Indian and Chinese companies will make it difficult for Indian products to counter Chinese ones in the domestic market. Bilateral trade between India and China in 2019 stands at a whopping $84.3 billion. Even though there is a 3.2 percent drop compared to the previous year’s $95.7 billion, it is still evident that imports from China are flooding Indian markets with commodities that are both essentials and non-essentials. For a self-reliant India, Indian companies need to retain atleast a fair share of the domestic market from China and other foreign companies. The various reforms announced under the Atmanirbhar Bharat scheme is aimed at doing just this, making Indian companies capable of catering for both domestic needs and international needs, thereby turning these companies into global brands.
For the Prime Minister’s vision of ‘vocal for local’ to succeed, local manufacturing, local markets, and local supply-chains should get the thrust Atmanirbhar Bharat scheme guarantees. Thus, to make the ambition of a self-reliant India true, the administration should pave way for the right factors that can lead up to that.
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