Tough Talk; Thorny Walk - Towards a Atma-nirbhar Bharat…

-- Dr Navniit Gandhi

Sunday, August 9, 2020

China occupies approximately 43,180 sq kms of Indian territory in the erstwhile state of J&K. This is in addition to the gradual advances of their army into Arunachal Pradesh since the past several decades, which include building of roads, highways and bridges along the entire stretch of the 1126 kms long LAC in Arunachal.
And yet, we do not bat an eyelid when we give $56.8 billion of surplus (2019 figures) to China in bilateral trade. Partly, it is because we cannot manufacture enough and we do not manufacture certain items for which we depend on them but it is also true that the billions go to China in surplus because we keep preferring cheaper goods coming from there over the goods made in our own country. It is not that lamps, batteries, stationery, candles or balloons or other small items are not made in India but we believe in saving our pennies and buying Made-in-China goods even if a similar product made in India is available, though slightly expensive. Whether buying bathroom slippers or ball-point pens, we think we are saving up but we are instead handing out billions of dollars of precious foreign exchange to China annually as we prefer their goods over ours.

Even after flooding the markets with their goods, and making huge profits in the process—its designs at our borders are nefarious. Even a child knows the real intentions behind the bonding between China and Pakistan and behind the entire gamut of CPEC (The China Pakistan Economic Corridor). It keeps threatening us; it keeps making unilateral claims; intruding into our territories and it keeps playing its mind-games against us. It threatens us over Arunachal Pradesh and Sikkim, claiming that they are theirs. In our own country, when we build a road or an air strip or launch any infrastructural project be it in Ladakh or Arunachal or Sikkim, it warns us of dire consequences and mocks at us, telling us to remember the 1962 defeat. It threatens us and the whole wide world, dare they recognize Taiwan or talk about Tibet and now, it dares anyone to raise the issue of what is happening in Hong Kong.

When a nation trades with China, China makes it sign and submit to the ‘One-China’ Policy, thereby restraining us from establishing diplomatic ties with Taiwan, so much so that other than some 15 obscure nations somewhere which have dared to recognize Taiwan and establish diplomatic ties with it, the whole world---including the mighty G-8 have not done so and do not dare to disobey this or other diktats of China. Would India ever succeed in making China or any other powerful nation agree to a ‘One-India’ policy as a pre-condition before trading with India and agree that PoK (Pakistan Occupied Kashmir) is ours?

Why, during the pandemic, which originated from China and at the heart of which several believable conspiracy theories float, did many nations not dare to question China, when it kept supplying sub-standard crucial medical goods worth billions to nations all over the world? There were no apologies even remotely implied by China, in response to any of the hardships the world continues to suffer from. Would India be forgiven if we had supplied sub-standard masks, faulty ventilators or test kits or if we had suppressed the pandemic thus and allowed it to bring the world to its knees? The reason is purely ‘economic’. The more the world remains dependent on Chinese goods, the more it grows economically stronger and the wealthier it becomes—the more it controls the economies of other nations and the more it does that, more aggressive are its postures --whether with India or in the South China Sea.
What can we do?

China is the world’s no.1 manufacturing giant.

Several questions plague our mind these days:

•Will it be possible for us to boycott goods made in China?
•Can this dependence be altogether gotten rid of?
•How shall we manufacture what we do, without the small components/parts or even boxes and packaging material from China?
•Is this a passing frenzy which shall die down as soon as the pandemic ends and everybody scrambles for lost livelihoods and missed monetary gains?
•Can India really be self-reliant?

Of course, it won’t be easy. An Atma-nirbhar Bharat will not happen too soon.
It was not an easy walk even when the Swadeshi movement happened in India. We hardly had any indigenous industrial activity and goods made in India then (due to the destruction of our local industry by Britain over a period of time), but we had the strong nerve to decide what we did not want (the British-made goods dumped on us) and were determinedly focused on our aim of crippling the economy of our colonial masters. They had stolen and systematically drained out $45 trillion from India during the period 1765 to 1938 and left us poor, starving and malnourished and behind the rest of the world by hundreds of years. The call for boycotting foreign goods may have been a political movement for some then, and meant economic self-reliance for some others but for Gurudev Tagore, it was ‘Atmashakti’. And indeed, the several exclusive Indian ventures which started during that period strengthened the spirit of India. They were baby-steps in comparison to the rapid pace at which India was regressing and being pushed into the corridors of darkness, but the little resolution to reduce our dependence on foreign goods and buy Swadeshi, made a lot of difference—first to the mind-sets of the masses and then to the economy.

Today, as soon as the words ‘self-reliant India’ echo all around us, it is China that we think of; it is Chinese products that we think of boycotting. However, the quest for self-reliance --while it may particularly be directed at one nation, it certainly need not be our sole ambition.

A few sceptics (or, the pragmatic folks?) think that what can ‘we’ ---the common folks do unless and until the government curbs its imports from China. And yes, China is a huge player in global supply chains and our dependence cannot be done away with overnight, more so in the telecom and electronic equipment industry. But a disruption in those supply chains is essential to nudge a ruthless player with hegemonic designs. Japan too is giving massive incentives to its own and to other companies to shift production out of China and to try and switch over to local supply chains. There will be issues in the short-run but then we have always been and are most adept at compromising and adapting to hardships.

This certainly does not imply that foreign-made goods or goods originating from China have to be shunned totally. We are not to slay the spirit of globalization. We are not to revert to pre-1991 days when domestic industry was unduly protected and shielded from global competition and hence, it incurred losses, deterred innovation and could stand feebly on crutches. We need foreign capital; we need foreign technology and even foreign goods to keep our own industry thriving and on its toes. It is the arrogance of one domineering power that needs to be tackled. And based on its economic might, when a power threatens repeatedly and aggressively annexes territory and resorts to unfair games in politics and economics, that our dependence on that country ought to be a matter of worry for every citizen of India.

Here, our soldiers have been getting martyred for decades due to the uncalled-for aggression from China, and there, we are buying Diwali lamps and rangoli powder and laughing Buddhas made in China. No self-respecting nation would exactly do that. We are buying $56 billion worth more (the total imported goods worth being $74.72 billion from China) goods than what China buys from us. Why? Are all the items/products/services that we are importing so very essential for us? Is there nothing we can do without? Can we not stop ourselves from buying even the cheap goods of daily use with which they have flooded our markets? Does the rakhi that we tie on raksha bandhan have to be the one made in China?

A leading Research and Ratings Agency has said that India can reduce its trade deficit with China by $8.4 billion over the next two years through developing and using our local products in sectors such as chemicals, automotive components, bicycle parts, agro-based items, handicrafts, cosmetics, consumer electronics and leather based goods. Can we not think over it? Of course, even then --the deficit would be a staggering $50 billion or so. But, let us start taking small steps… 90% of our toy imports were from China in 2018-19. Can we not start by buying toys made in our own country?

We have just begun taking our baby steps. Yet, there are areas in which we can take a lead too, as for example: pharma/bio-tech, solar cells/panels and modules, engineering goods, robotics and automation, and even AI. At first, let us make ourselves uncomfortable by looking at local products and alternatives to satisfy our requirements, and if unavailable--- not adjust without them but strive to make them locally.

We have been offering sops to giant MNCs to invest in India and start making in India. and yet, at the same time, we must encourage our local Micro, Small and Medium Enterprises (MSMEs) to join the hands and together build some giant undertakings that can take on the world, in the years to come. Unless we encourage innovation at the most local level, and focus on creating a partnership between the big industry, the MSMEs and the foreign companies that will set up plants in India, the dragon shall continue to fume and threaten us with its fury.
Even when we invite foreign companies to come and make in India, there is no guarantee that a transfer of technology shall happen, and unless and until we develop our technical know-how and infuse India with a spirit of innovation, the dependence shall remain. Our problem is not finance or even manufacturing to a large extent but the big quest is to acquire the technological edge without which self-reliance is but a dream. There are nations which have surged ahead rapidly because they encouraged every novel ‘idea’ and urged people to come forth with their innovations and gave them the required backup. Bragging about having a large young population will sound hollow unless that young population is thinking hard and creating solutions for India Inc.

Singapore, Hong Kong, Taiwan, Israel and S Korea could foster their self-reliance capabilities because the governments invested in R & D, gave new ‘ideas’ the opportunity to develop, and ensured policy support and tech support to private companies, while also giving them a skilled citizenry and infrastructure and only then could their enterprises take off. Of course, we are nowhere in the picture when it comes to these and other advanced countries such as the US, Germany, and China because they have insurmountable leads. They are way too ahead of us.

The journey must begin, though…

“No real change in History has ever been achieved by Discussions.”
--Subhash Chandra Bose

Several factories such as the textile factories which were forced shut during the pandemic, seized an opportunity in the crisis and took to alternate manufacturing, by making PPE gear. India today manufactures almost 4,50,000 PPE suits daily, becoming the second largest manufacturer of PPEs in the world. All of this happened in less than 60 days. Faced with an acute shortage of ethanol, a group of tribal women from the dense forests of Madhya Pradesh understood the meaning of local is vocal and began manufacturing organic hand sanitizers with the liquor made from Mahua flowers.

Things seemed to be looking up… Just as several multi-national companies were contemplating moving their manufacturing units from China to India, the most effective distraction happened which managed to hit several birds with one stone---yes, the Galwan aggression. It was intended to paralyse policy-making and fill our mind-sets with anxiety in addition to making us divert precious resources to fight aggression in lieu of efforts to get the economy on tracks.

India is somewhere at the bottom when it comes to manufacturing and share in the global trade. When one hits rock bottom, then surging up; moving forward is the only inevitable option. China has been on the peak for quite some time now. It has dominated, threatened, been aggressive, flooded the world with sub-standard goods largely, and has played ruthless games of power politics and resorted to economic arm-twisting. Alas! From the peak, a climb-down is the only inevitable option.

‘I’m not so much a dragon slayer, more a dragon annoyer---I’m a dragon irritator.’
-Craig Ferguson