Let me begin today’s column with John F Kennedy’s saying: “The Chinese use two brush strokes to write the word ‘crisis’. One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger–but recognize the opportunity”.
The quote has been retold innumerable times as a stimulating guide to our thinking. The saying is loaded with the message that whenever we faced a crisis we should evaluate the crisis in terms of danger as well as opportunity.
As we know, all of us stand challenged by Covid-induced circumstances. It’s obvious to first think of the life-consuming danger which this virus has unleashed and created unprecedented trying circumstances around us. After over a year of the crisis, when the world was on the verge of stepping into a post-Covid era, second phase of its outbreak marked its presence and unnerved the nations. This time, the crisis seems purely focused as a health emergency and governments are trying to exercise maximum possible caution to avert its impact on the economy unlike the situation we witnessed in the first phase of the pandemic.
At the moment the second phase of the pandemic is dubbed as ‘deadly’ and the behavior of the virus is yet to be exactly ascertained. How damaging it could be for humans? This is the question haunting the experts, leaving common masses clueless. Here it’s worth mentioning that the second innings of the virus sweeping human habitations has challenged the authenticity of the vaccines.
However, the health experts are in denial mode and thrust on vaccination of populations across geographies has been mounted to combat the invasion of the virus. At the moment it is immature to make a conclusive comment about the fight which health professionals are fighting with the virus.
Let’s not dip deep into the dangers of the crisis and have a look at the other side – the opportunity. As far as the element of opportunity in crisis goes, we saw a big push to the concept of Atmanirbhar Bharat and rolled out as a mission to achieve by none other than the Prime Minister Narendra Modi. In fact it was reborn in the Covid crisis and presented as a major tool to fight never-seen-before economic crisis triggered by the pandemic-induced lockdowns. The Atmanirbhar concept is not only for the purpose of bridging economic gaps created by the pandemic-induced lockdowns, but it has been presented as a prescription to achieve self-reliance in various economic sectors of the country. So, the Atmanirbhar Bharat campaign is aimed to relieve the country of the burden of imports to a large extent over a period of time. In a way, it’s similar to the concept of import substitution and promoting local production instead of banking upon imported goods.
Even as the government says Atmanirbhar Bharat is not import substitution, but the elements in it encourage support to domestic industry in taking new opportunities which disruption in global economic supply threw owing to pandemic-induced lockdowns. The stimulus packages rolled out by the government during Covid-19 crisis to get the economy back on track was loaded with import-substitution policies. Remarkably, the prime minister is on record to state about a self-reliant India — Atmanirbhar Bharat. While speaking in his monthly ‘Mann Ki Baat’ radio broadcast on May 31, 202, he emphasized the need to disincentivize import of goods, which can be manufactured domestically.
Precisely, pursuing import substitution at national level is not a bad idea and exploring the virus-induced opportunities can go a long way in achieving economic self-reliance where demand and supply would be met within the borders of the country.
However, import substitution should not be at the cost of exports, which needs equal impetus. It’s here the challenge of striking balance between imports and exports emerges for the government.
In other words pursuing Atmanirbhar Bharat mission needs to be equally aligned to lay thrust upon exports, if desired results of self-reliance are to be achieved. In fact, giving more push to the exports will make the import substitution mission an easy accomplishing task with assured growth of the domestic industry.
It’s worth mentioning that exports are a source to generate foreign exchange. It’s this foreign exchange which is utilized to import essentials in terms of technology and machinery for domestic industry. This is turn lays the base for building a resilient domestic industrial set-up to achieve self-reliance or what we can say import substitution. In others, it’s the strong export policy which can go a long way to achieve Atmanirbhar mission.
Let me quote an acquaintance, an economist of repute, advocating need to scale-up the size of exports. He says: “First of all import substitution policy should include those sectors where we have edge to explore the potential. There is need to identify specific sector where this self-reliance policy can be invoked. Export-driven industries are a corner-stone for Atmanirbhar Bharat. These are the sources for generating more and more foreign exchange for the country. The government can use this foreign capital for upgrading skills, technology and capacity building in sectors picked for import substitution.”
One more important thing is that while pursuing the mission of import substitution, the domestic industries need to be globally competitive and should at the end, at least, benefit local consumers.
In short, the Atmanirbhar campaign, which is in its infancy stage, needs to be revisited. Specific economic sectors are identified to pursue import substitution and at the same time aggressive export promotion is given equal attention to achieve economic goal in post Covid era.
In succinct, the Atmanirbhar campaign, which is in its infancy stage, needs to be revisited. Specific economic sectors are identified to pursue import substitution and at the same time aggressive export promotion is given equal attention to achieve economic goal in post Covid era.
Meanwhile, in the context of Jammu & Kashmir, import substitution policy was discussed couple of years back as a way out to pursue economic growth by producing the products within the state rather than importing from other states. At the same the aim was to encourage self-sufficiency and also to aid the protection and promotion of local industries as well as entrepreneurship.
It is important for a geography like ours to understand the rationale for import substitution. We have to first understand the basic forces at work in our economy. However, we cannot overlook this substitution in certain sectors like horticulture, floriculture and dairy. For example, our apple industry stands now seriously challenged by forces outside players. Despite having huge potential in floriculture, this sector remains under utilized. Potential in dairy is enormous. We have failed to scale it up in an organized manner. To a large extant, failure of cooperative sector in the state is responsible in spoiling the huge economic potential of sheep and dairy farming and even poultry farming in the state.
On top of it, let’s take the case of power. Importance of providing sustainable and affordable energy to the people here has always missed the focus of our ‘men of vision’. As far as providing of energy to even poorest of the poor goes, it is only through harnessing of hydel-power – best suited for our unique set of circumstances.
How cheap hydel energy helps to eradicate poverty and generate heat in economic activity can be gauged by the fact put forth by experts that by installing a one-megawatt hydel power project in along with complete distribution network for the area can change the socio-economic conditions of the area by providing electricity to run machinery and equipment for the manufacturing and processing of local goods. This locally-generated energy will also be creating skilled job opportunities in the power supply system as well as in workshops for making electric appliances and fixing electric installations. Small and medium industries can immensely benefit through this cheap energy. Precisely, it would be rejuvenating our cultural energy.
We all know, our need for power is acute and urgent in nature. There is need to have a policy framework to be evolved in order to develop the hydro power potential of the State. In fact, power is the key to import substitution.
(The views are of the author & not the institution he works for)