Self reliance since independence

Just after independence

• In the decades following independence, self-reliance in state-run heavy industries and strategic sectors had placed India ahead of most developing countries.

In 1970s and 80s

• India’s industrial ecosystem was characterised by low productivity, poor quality and low technology, and was globally uncompetitive because
  • Modernising the industries with technological upgradation didn’t happen.
  • The private sector backed the state-run core sector approach in its Bombay Plan and stayed content with near-monopoly conditions in non-core sectors in a protected market.
  • Efforts made to modernise light industries or develop contemporary consumer products was little.

In 1990s

• When India began liberalisation, privatisation and globalisation, the very concept of self-reliance was of no use, since advanced technologies could simply be bought from anywhere at lower costs.

Reasons for declining self reliance 

• Undermined PSUs

• • Public sector undertakings (PSUs) are becoming inefficient since no effort was made to attain either real autonomy or a transition to new technological directions.
  • Also PSUs with capability and scale for the task were undermined along with many research and development (R&D) efforts that display signs of future potential (for instance, in photovoltaics, semiconductors and advanced materials).

• Disinclination of private sector towards R&D

• • The private sector showed little interest in  heavy industries and none for technology upgradation.
  • Most Indian private companies ended up in technology imports or collaborations with foreign corporations and hence most of the R&D work is carried by PSUs.

• Inviting FDIs obviates need for self reliance

• • It was thought that Inviting foreign direct investment and manufacturing by foreign majors would bring new technologies into India’s industrial ecosystem, obviating the need for indigenous efforts towards self-reliance but foreign majors guard commercially significant or strategic technologies in off-shore manufacturing bases.

Measures to boost self reliance

• Significant government reinvestment in PSUs and R&D is essential for self-reliance.
• State-funded R&D, including in basic research by PSUs, research institutions and universities need to be scaled-up significantly
• PSUs need to be upgraded and reoriented
• Private sector delivery-oriented R&D could also be supported, linked to meaningful participation in manufacturing at appropriate levels of the supply chain.
• Since no country has achieved self-reliance without mass quality public education, India’s meagre public expenditure on education needs to be ramped up including in skill development.

Reference:

https://www.thehindu.com/opinion/op-ed/how-india-can-become-self-reliant/article31681288.ece