ForumIAS announcing GS Foundation Program for UPSC CSE 2025-26 from 19 April. Click Here for more information.
ForumIAS Answer Writing Focus Group (AWFG) for Mains 2024 commencing from 24th June 2024. The Entrance Test for the program will be held on 28th April 2024 at 9 AM. To know more about the program visit: https://forumias.com/blog/awfg2024
Source: The post is based on the article “A low-tariff regime can do India a world of good” published in the Livemint on 19th November 2022.
Syllabus: GS – 3 – Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.
Relevance: About challenges faced by the Indian economy.
News: The deputy managing director of the International Monetary Fund has said that a global need to diversify purchases had generated interest in India in other words “The world is looking at India as a destination for investment.”
What are some major remarks of the IMF deputy manager on the Indian economy?
There is a global demand weakness as imminent and tighter financial conditions as a potential trouble. The risks of supply over-reliance on China gain salience globally.
-Indian exports are showing signs of slowing down and dearer dollar debt has drawn capital out of the country and hit the rupee.
-Smartphone factories are improving in India due to production-linked incentives for manufacturers. Further, private funds have also started coming into other industries. However, their performance is too small for job generation and remains as a challenge in the trajectory of India’s economic growth.
–Retrospective taxation, rejections of foreign dispute settlements and a revenue-sharing clutter in telecom have created a bad reputation.
–Land acquisition has not eased and India’s labour market stands with great gender imbalance.
What should India do to boost its economy at the global level?
As global-scale manufacturing today tends to span multiple borders hence integration with supply chains is crucial.
Indian policymakers are keen to establish India as a factory for the world. But it is still a steep ambition, and achieving it will need well-rounded policy alignment.
The government has cut taxes for new ventures and sought to slash red-tape and eased tax remission for exporters. A lower-tariff regime will also push local producers to generally get more competitive.
