LOCALISATION VS GLOBALISATION

BRIJESH GOYAL CHAIRMAN, CHAMBER OF TRADE & INDUSTRY

There is plenty of evidence that concerned consumers prefer localisation, promoting products which are distinctive goods made with local ingredients, creating sustainable local employment and reducing the need for transport.

On the other hand, globalisation has led to global supply chains which enable specialisation, more jobs in low-skilled assembly lines in low-cost emerging economies, economies of scale due to access to much larger markets, and consumers benefit from much lower prices for better products.

Excerpts from an interview with Brijesh Goyal, Chairman Chamber of Trade & Industry (CTI)…

In the wake of corona crisis and the escalated tensions at the borders, it becomes the need of the day to hit China economically and give boost to the Indian Manufacturing and Trade by simultaneously ensuring no harm to the Indian economy. CTI has written a letter to Hon’ble PM Modi and Commerce Minister Piyush Goyal. CTI Chairman Brijesh Goyal and President, Subhash Khandelwal said that China is not only the creator of the Corona pandemic but is also the biggest enemy of our country.

Brijesh Goyal said weakening Chinese economy and reducing the dependence of Chinese goods in India is very important. In 2019-20, India has imported goods worth about 65 billion dollars from China. India is a very big export market for China. This is something, which cannot be done overnight but a long term and a strategic plan has to be drawn. This has to be done in 3 phases.

Short Term

• Restricting Chinese goods that are already made in India or goods that can easily made in India with existing facilities or goods whose import restrictions won’t have any impact on the Indian economy.
• There are many such items that are imported in large numbers from China. But, these items are already made in India and the Indian manufacturer needs little support to substitute the Chinese Import for these specific items.
• Toys, Textiles, Footwear, Electronic & Electric Items, Cosmetic, Gift Items, Watches, Clothing, Furniture, Lighting, Furnishing Items, Kitchen Goods, Hand Bags, Fashion Apparel, Gems & Jewelry, Stationery, Health Products, Holi Items, Diwali items etc.
• Import on these items should be immediately prohibited.

Medium Term

• Goods that can be manufactured by upgrading the existing facilities or by importing the required machinery or by technology transfer.
• In this context all local industries falling under MSME categories should be supported for the required technology, finance and support required enhancing the scale.
• Upgrading the existing facilities for achieving the required technology levels and the economies of scale like auto components, machinery, engineering goods etc.

Long Term

• Special trade specific groups to be formed that should include senior Bureaucrats & representatives of specific trade to have in-depth study of the trade and its potential.
• It involves making India a big-manufacturing hub for domestic & export requirements. To Encourage the Local manufacturing Government should simplify the norms that create ease in doing business.
• There should be trade specific zones to enable suitable infrastructure according to the needs of the industry.

CTI General Secretary Vishnu Bhargava & Vice President Navdeep Malhotra recommends few immediate steps that need to be implemented at the earliest:

• If India starts discouraging Chinese goods, it can come with hidden routes in the market. Thus, it requires a law to strictly mention “COUNTRY OF ORIGIN” on the packaging of products, as this will create transparency. This will prevent European & American brands to dump “Made in China” products in India.
• There should be difference in import tariff between the goods that are completely packed, printed or branded against the semi knockdown kits. This will encourage assembling of the components in India thereby reducing the import bills and will create employment for Indian labor.
• Stop giving Roads; Rail & Infrastructure projects to Chinese companies stop giving construction projects to Chinese companies. BNB