Thursday, January 1, 2015

electronics products | Make in India

In order to give push to ‘Make in India’ campaign, recently the government asked all government departments to give preference to domestically manufactured electronics products in their procurement. Is this a right step? Critically examine.


To give the edge to it's ambitious "Make In India " program government recently asked the all departments to give their preference to the domestic manufactured electronic items in their procurement's. But it is essential to analyse the move in the lime light of both it's pros and cons.
Pros-
They biggest advantage of this move that it will help in the development of indigenous market. Such procurement's also enhance the share of manufacturing in the economy, which give the competitive edge to the manufacturing sector. Furthermore giving emphasis to the indigenous manufacturer helps India to fix it's infrastructural bottleneck and it will also generate additional employment opportunity in nation. Here it should to be also noted that the government is investing large share of it's revenue in importation such electronic items and if the same amount will pump in the domestic market it will be admire both social and economical obligations of government.

cons-
The main concern in this regard is the lack of proper infrastructure. Despite of tremendous 6 % growth the manufacturing sector failed to give the competitive edge to the sector. This will hinder the domestic procurement's. Furthermore it has been also observe that the indigenous electronic items is not of so high quality and internationally they did not enjoy the eminent position as Chinese, Japanese or Korean enjoys. In this regard it is worth to mention that the such step to government also revoke their reformist zeal , as now the government is their buyer.Furthermore giving too much emphasis on the domestic market can create a unhealthy working environment for the foreign entities, which is not a good signal for any economy as a whole. Furthermore it also deteriorate the bargaining power and have great probability to create a monopolistic market. 
So while analysing all these arguments it is very clear that although the need of the hour is to promote indigenous market but it does not mean that eventually India should be turn in closed economy. Rather than a proper equilibrium between the indigenous and foreign players can adore the larger public interest.

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