India's Trade Deficit with China is a Self Goal That needs to be tackled - Says Nilesh Shah in this interview on NDTV
The trade deficit of 60+ Billion US$ or in other words approximately 4.2 Lacs Crores Rupees with China is rising year after year. That's a huge number and no country can give this kind of preference to any outsider.
However, the question that needs to be asked is how to reduce this massive trade deficit with China? Certainly, if 'Manufacturing' in India takes off, then, this number can surely be reduced. In other words, manufacturing Chinese-made goods in India itself for India's own consumption can reduce the trade deficit with China.
Not only will manufacturing these Chinese-made Goods in India reduce the trade deficit with China but also generate employment in the formal manufacturing sector in India.
The generation of employment will further boost GDP growth as this will bring millions of people in the formal economy.
So, why aren't Indians manufacturing in India? Why are they all going to China and buying simple household goods from China and sell them in India? Simple items like 'Electrical items', 'Electronics', 'Toys', 'Plastic products', etc. are sourced from China and sold in India? Why? Why are our markets like Chandni Chowk, Bhagirathi Palace market, Nehru Place market flooded with Chinese Goods? What stops Indian manufacturers from manufacturing these simple goods in India?
The policymakers shall focus on these questions to reduce the trade deficit with China. Which in turn will result in employment generation, pick-up in manufacturing, and a boost to the GDP growth!
The trade deficit of 60+ Billion US$ or in other words approximately 4.2 Lacs Crores Rupees with China is rising year after year. That's a huge number and no country can give this kind of preference to any outsider.
However, the question that needs to be asked is how to reduce this massive trade deficit with China? Certainly, if 'Manufacturing' in India takes off, then, this number can surely be reduced. In other words, manufacturing Chinese-made goods in India itself for India's own consumption can reduce the trade deficit with China.
Not only will manufacturing these Chinese-made Goods in India reduce the trade deficit with China but also generate employment in the formal manufacturing sector in India.
The generation of employment will further boost GDP growth as this will bring millions of people in the formal economy.
So, why aren't Indians manufacturing in India? Why are they all going to China and buying simple household goods from China and sell them in India? Simple items like 'Electrical items', 'Electronics', 'Toys', 'Plastic products', etc. are sourced from China and sold in India? Why? Why are our markets like Chandni Chowk, Bhagirathi Palace market, Nehru Place market flooded with Chinese Goods? What stops Indian manufacturers from manufacturing these simple goods in India?
The policymakers shall focus on these questions to reduce the trade deficit with China. Which in turn will result in employment generation, pick-up in manufacturing, and a boost to the GDP growth!
