There is no dependence that can be sure but a dependence upon one’s self. – John Gay
History of self-reliance in India
Swadeshi movement was the occasion when the word “self-reliance” got introduced for the first time in the Indian economy under the veil of the word ‘Swadeshi’. Swadeshi movement was a part of the Indian Independence Movement. It was an economic strategy aimed at removing the British from power and improving economic conditions in India.
Current scenario
The scope of self-reliance has changed over time in India. However, the main theme of self-reliance is still the same i.e, depending on yourself for things instead of relying on others.
It is to be noted that the term “Swadeshi’’ at the time of independence meant adapting indigenous products and rejecting foreign-made products as well as boycotting foreign trade.
However, self-reliance, in the current scenario doesn’t mean to be self-centric. It means to be reliant on our own power and resources as well as enhancing our capabilities & technologies. So, we can emerge as the world’s best exporter of domestically produced products.
The Crisis response and Globalization
India witnessed a major change in its economy when the New Economic Policy, 1991 (or NEP 1991) was introduced. It was in response to the economic crisis (more accurately, BOP i.e. Balance of Payment crisis) and consequent fall in foreign reserves faced by the country.
NEP, 1991 was initiated with a motive to lift excess direct controls and to make the economy more market and service-oriented. Also, to expand the role of private and foreign investment. India under its NEP approached International Banks for the development of the country. These agencies asked the Indian Government to open its restrictions on trade done between India and other countries.
One of the major elements of NEP was LPG Policy i.e, Liberalisation, Privatisation, and Globalization. This was the phase when globalization came into the picture.
Understanding Globalization
As per various economists,
“Globalization is the process of interaction and integration among people, companies, and governments worldwide’’. It means to integrate one’s economy with the global economy. Globalization also attempts to create a borderless world and a world where the need for one country can be driven from across the globe and turn the globe into one large economy.
Globalization, as introduced in 1991, started with the process of dismantling trade barriers along with abolishing quantitative restrictions which had both positive as well as a negative impact on the economy.
Pros and Cons
On one hand, globalization attracts an entry of foreign capital along with the foreign updated technology, and on the other hand, Globalization paves the way for a redistribution of economic power at the world level leading to domination by economically powerful nations over the poor nations.
Globalization in India, on one hand, discourages uneconomic import substitution which reduces the capital-output ratio in manufacturing industries. But on the other hand, globalization usually results in a greater increase in imports than the increase in exports. And this also hits the domestic industries badly.
Assessing the negative impact of globalization on the economy, a few countries like India have started perceiving globalization with a different viewpoint. India is already taking action against the surge in Chinese imports. According to a survey data of 19 countries on the topic of Globalization, the countries that seem the most sceptical about Globalisation seem to be more developed economically. In the United States, only 40% of respondents saw globalization as a force for good, while 27% saw it as a force for bad and a large portion of the population wasn’t sure (33%). The U.K. and Australia have similar numbers, with France having the lowest portion of respondents saying globalization is a force for good.
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Self-reliance vs Globalization
Being self – reliant means closing one’s economy for foreign goods, which will lead to global inefficiency and the world economy will worsen off. But then globalisation also hurts the domestic economies which is why a government has policies like public procurement policies and local content requirements.
The Mercantilism theory supports the government’s promotion of domestic industry, often at the expense of other countries. It stands in contrast to the theory of free trade – which argues countries economic well-being can be best improved through the reduction of tariffs and fair free trade. In past decades, globalization and self-reliance have always been viewed as opposites. It was considered that where self-reliance leaves globalization comes into the picture. But this concept is now considered as some old school outdated theory. The modern perception of globalization vs self-reliance is entirely different. One of the many theories suggests that, nowadays, both concepts go hand in hand instead of competing with each other.
Now, Globalization in India not only focuses on the integration of economies but instead it also focuses on the ways by which country can emerge as a leading exporter of world-class products. The shift of globalization is towards being a prominent exporter rather than being an importer and serving as a dumping yard for Chinese as well as other foreign products. Now, swadeshi should be reinterpreted as a bridge between robust localization and inevitable globalization.
Make in India
Make in India initiative can be taken as a prominent example of the kind of globalization and self-reliance that we’re talking about. Prime minister Narendra Modi launched the Make in India initiative on 25th September 2014, with the primary goal of making India a global manufacturing hub by encouraging both – multinational as well as domestic companies to manufacture their products within the country.
In words of the Prime Minister, “Come make in India. Sell anywhere, but make in India”.
The program is growing strong and is focused on transforming the country into a global business hub. It’s now the demand of the current scenario to encourage these types of initiatives.
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Aatm Nirbhar Bharat
Addressing the COVID-19 situation in the country, on 11 May 2020, Prime Minister Narendra Modi stated,
“The corona crisis has taught us the value of local manufacturing, local markets, and local supply chains. Local is not only our need, but it’s also our responsibility’. He said, “ It’s time to be vocal about local”. In an incitement to Prime Minister’s address, domestic brand Lava announced to shift its entire mobile manufacturing for the export market to India within a few months.
Post-Prime minister’s call for “vocal for local”, it was clarified by the ruling party’s spokesperson that, “when we say local, its not just local products made by domestic companies. Anything which is manufactured in India is local for us”.
Despite the clarifications, people had misconceptions that being self-reliant meant a complete boycott of foreign trade and foreign products.
It is to be noted that, being self-reliant doesn’t mean throwing our i-phone into the dustbin and start using Nokia phones. Also, it doesn’t mean boycotting a ride on your BMW and start riding Maruti. It’s just about making our domestic product competent enough so that they stand out in the national as well as international market. It’s about developing our technology and manufacturing techniques in a way, that will urge people to invest in the Indian economy as well as urge them to purchase from India Economy, not by force but by choice.
So let’s contribute in our capacities to build India a better nation to invest in and help our nation to achieve the goal of self-reliance by walking through the lanes of globalization.
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cover image source: boltahindustan.in
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