Indian industries should not seek permanent protectionist measures from the government to safeguard themselves from competition from other countries, said Chief Economic Advisor V Anantha Nageswaran on Wednesday during his address at an event organised by Care Edge.
“We need industrial policy focused on productivity and performance. In other words, most of the time the industry still looks for protection from competition because we think some other country has a large capacity, production facilities and as they use both tariff and non-tariff measures, we need to use them as well,” added the Chief Economic Advisor.
However, he assured that there will be adequate support from the government and India won’t remain ‘passive’ when such policies are applied by other countries.
“Protection should not be in perpetuity, not be permanent but in return for productivity and export performance and it has to be temporary,” added Nageswaran.
The industry also needs to ensure that there is no trust deficit with the government, cautioned the CEA. He said that if the government trusts and deregulates but industry doesn't respond, then the government will come back with a higher level of regulation and tightness.
He asserted that regulation has to be broken through the ‘virtuous circle of trust.’ “To fulfill our destiny or the dream of becoming Viksit Bharat, we need to overcome this trust barrier,” said the CEA.
He strongly advocated for de-regulation, saying this will be an area of focus for India, with panels to soon submit reports on the action plan.