Niti Aayog CEO Amitabh Kant slammed Indian industry for constantly seeking protection from the government in order to compete with cheaper imports and said such a ‘19th century’ approach to doing business will only create ‘third-class companies.’
“We have overprotected our companies, including automobile companies, for far too long. Every time we have opened up to competition, our companies have done well and competed with the world. If we keep protecting them, we will create third class companies,” Mr. Kant said at a panel discussion hosted by the Indian School of Business in the capital. We have protected our industry, set a minimum import price for steel…
“We are here to protect small and medium enterprises. But we must understand that in a globalised world, you can’t be uncompetitive and keep saying ‘Protect us, Protect us,” said Mr. Kant, who was earlier the secretary in the department of industrial policy and promotion.
Mr. Kant said that companies must raise their productivity in order to compete and make for the global market in India. “You can’t close yourself, be unproductive and seek protection like in the 19th century. If you are cost-competitive and attain size and scale, you can compete with the world like other (Indian) firms have,” he said. Mr. Kant said he didn’t subscribe to the view that the Indian economy can keep growing on the strength of its domestic demand. “For a short period, it may help, but the real value is in capturing exports where Indian producers can get ten times the value that they would earn domestically,” he said. Indian industry should embrace the convergence of digital technologies with manufacturing processes instead of fearing them, he said.
“Manufacturing used to be dark, dirty and dangerous. But today, it is extremely fashionable and sexy… Let us not fear the onset of Manufacturing 4.0.”
If you are cost-competitive and attain size and scale, you can compete with the world like other (Indian) firms have.
Amitabh Kant,CEO, Niti Aayog
