FB   
 
Powered bysps
        Society for Policy Studies
 
 

 
India must play its part in the global trading system, not shy away from it
Updated:Apr 24, 2017
 
Print
Share
  
increase Font size decrease Font size
 
India is among the countries most vulnerable to rising global protectionism warns the most recent Global Financial Stability Report of the International Monetary Fund. Most of the demand that drives the international trading system still remains in the developed countries and as they raise the drawbridge against imports, the biggest losers will be emerging economies like China, India and South Africa.
 
The knock on effect on India will be not merely in terms of falling exports. It will also be in increased financial pressure on the balance sheets of local corporations and, therefore, the non-performing asset problems in the banking sector. And among six emerging economies that the IMF looked at, India has by far the most vulnerable banking sector.
 
The IMF report does not dwell on what can be done to salvage the global trading system. But it is an issue to which the Narendra Modi government should give some thought. India is a nation that has long been gripped by export pessimism, a term applied to countries who believe they cannot compete and opt out of international trade.
 
Yet almost all the countries who have pulled themselves out of poverty and into the ranks of high-income states have done so on the back of 
international trade.
 
The Modi government has run away from negotiating even the smallest free trade arrangements, ripped apart existing foreign investment treaties and run interference at multilateral trading talks.
This is unfortunate. New Delhi’s reluctance to more actively support the multilateral trading system – and in fact act as a spoiler to its success – is a remarkably short-sighted policy. India’s future growth continues to heavily depend on foreign investment and trade. Also the ability of India’s homegrown companies to become global players is tied strongly to their success in tapping the larger world market.
The Modi government’s reform measures, like “ease of doing business” and the Goods and Service Tax, will be important in making India globally more competitive.
Perhaps the government plans to re-engage the international trading system when it feels domestic industry is competitive enough. That may be a long time coming: Protectionism breeds mediocrity. Worse, there may not be much of a trading system to rejoin if countries like India are not prepared to lend it support when it is under attack.
 
Hindustan Times, April 24, 2017
 
 
 
 
Print
Share
  
increase Font size decrease Font size
 

Disclaimer: South Asia Monitor does not accept responsibility for the views or ideology expressed in any article, signed or unsigned, which appears on its site. What it does accept is responsibility for giving it a chance to appear and enter the public discourse.
Comments (Total Comments 0) Post Comments Post Comment
Review
 
 
 
 
spotlight image Since Prime Minister Sheikh Hasina assumed office again in Bangladesh in 2009, bilateral relations between New Delhi and Dhaka have been on a steady upward trajectory.
 
read-more
Pakistan Prime Minister Shahid Khaqan Abbasi has said that military dictatorship always halted progress in the country. The Prime Minister, who was in Karachi on a day-long visit, was speaking during the inauguration ceremony of the Pakistan International Bulk Terminal at Port Qasim.
 
read-more
Ruskin Bond’s first novel ‘Room on the Roof’ describes in vivid detail how life in the hills around Dehradun used to be. Bond, who is based in Landour, Mussoorie, since 1963, captured the imagination of countless readers as he painted a picture of an era gone by.
 
read-more
India’s foreign policy under Prime Minister Narendra Modi has attained a level of maturity which allows it to assert itself in an effective manner. This is aimed at protecting the country’s national interests in a sustained way.
 
read-more
Braid-chopping incidents have added to the already piled up anxieties of Kashmiris. Once again they are out on the streets, to give vent to their anger. A few persons, believed to be braid-choppers were caught hold by irate mobs at various places. They were beaten to pulp.
 
read-more
The upcoming 19th National Congress of the Communist Party of China (CPC) has captured world attention. French newspaper Le Monde on Sunday published a front page article headlined "China, the rise of the great power" in Chinese characters and carried eight pages on the topic, the epitome of Western reporting on the 19th CPC
 
read-more
In a move lauded worldwide, King Salman bin Abdulaziz Al Saud recently issued a royal decree allowing women to obtain driving licences.
 
read-more
Recently, United States President Donald Trump kicked the onus of the US backing out of the Iran nuclear deal to the US Congress. The question is how we interpret this technically, in terms of domestic politics and in terms of geopolitics.
 
read-more
It is a privilege to be invited to this most prestigious of law schools in the country, more so for someone not formally lettered in the discipline of law. I thank the Director and the faculty for this honour.
 
read-more
Column-image

Title: The People Next Door -The Curious History of India-Pakistan Relations; Author: T.C.A. Raghavan; Publisher: HarperCollins ; Pages: 361; Price: Rs 699

 
Column-image

Could the North Korean nuclear issue which is giving the world an anxious time due to presence of hotheads on each side, the invasion of Iraq and its toxic fallout, and above all, the arms race in the teeming but impoverished South Asian subcon...

 
Column-image

Title: A Bonsai Tree; Author: Narendra Luther; Publisher: Niyogi Books; Pages: 227 Many books have been written on India's partition but here is a firsthand account of the horror by a migrant from what is now Pakistan, who ...

 
Column-image

As talk of war and violence -- all that Mahatma Gandhi stood against -- gains prominence across the world, a Gandhian scholar has urged that the teachings of the apostle of non-violence be taken to the classroom.

 
Column-image

Interview with Hudson Institute’s Aparna Pande, whose book From Chanakya to Modi: Evolution of India’s Foreign Policy, was released on June 17.

 
Subscribe to our newsletter
Archive