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Context: Following the West’s stringent export controls restricting Russian state’s access to cutting-edge technology, there have been rising clamor on the need for self-sufficiency. However, there are certain points to consider before converting the goal of atmanirbharta into import substitution.
What needs to be considered?
First, there is no need for decoupling when there is substantial convergence of strategic interests between India and the West: The West prefers powerful India to counter China. For this reason, the post-Pokhran sanctions were replaced by a civil nuclear agreement between the US and India.
Second, the pursuit of self-sufficiency is itself a near-impossible goal: For instance, the government is pushing policy to attract semiconductor manufacturing firms to set up shop in India. However this is just one stage. Other stages are also there such as cutting-edge research, highly skilled workforce, testing and packaging. No country can do all these by itself. Hence, plurilateral collaboration is required.
Third, there is a need for Atmashakti. That is, India’s deep connections with the West foster technology transfer in critical and emerging technologies. For instance, initially the West helped China build its strengths.
Fourth, self reliance – can morph to self-harm via protectionism in technology manufacturing. For example: The banning of drone imports to become a global drone hub by 2030 is antagonistic. There’s no incentive for a company shielded by protectionism to compete with the best in the world.
What is the way forward?
Instead of protectionism, India needs to dominate in areas where the West is relatively disadvantaged. For example, the IT industry benefits immensely from the connections in the West.
There is also a need to provide stable and non-discriminatory tax, business and trade environments.
Source: This post is created based on the article “Atmashakti over atmanirbharta: Learn right lessons from Russia sanctions” published in Times of India on 28th March 2022.
