Dear MEL Topic Readers,
Why India is one of world's most
protectionist countries
India’s economy has been growing rapidly since
its economic reform 1991. Thanks to the large population and service sectors
including back-end IT systems, software development, and service centers, its GDP
is the world’s seventh largest as a whole. However, despite the size of the pie,
each portion is so small and it’s GDP per capita ranks below 100th.
One of the reasons is farming. Over one-third
of the rural population depend on the farming business. Their productivity is low because
of the lucrative government subsidies and accessibility to other markets is
quite limited due to the lack of efficient transportation systems. Though the
country welcomes foreign investment in most sectors but retail to protect their
small retail shops, it discourages import with high tariffs and inconsistent
regulations. It is the world’s largest democratic country and the government
policymakers and parliament’s lawmakers are both eager to entice 900 million
voters by creating more domestic jobs and subsidizing the agricultural industry. Speaking
of elections, their 2019 general election is ongoing.
But will protected industries survive or grow
in the long run? Well, since India’s general elections are held every five
years, anything beyond the next election seems way beyond their scope.
Enjoy reading and learning about the world’s
fastest-growing but most protected market.
No comments:
Post a Comment