Context :
South
Korea's Hyundai and Kia cost India billions of dollars in trade deficit, says
Piyush Goyal
Extract :
Union Commerce and industries minister
Piyush Goyal has said that Korean auto majors, like Hyundai and Kia, cost India billions of dollars in trade deficit by misusing the free-trade agreement between the two
countries.
Speaking at the Asia Economic Dialogue,
Goyal said that the free trade agreement allows these
companies to import indiscriminately.
"The Korean auto industry,
specifically Hyundai and Kia, are clearly two of the laggards. They have
enjoyed the benefits of our free-trade agreement with Korea and Japan and continue to import indiscriminately," Goyal said.
He added that the small investment of
half a billion or a billion dollars has
cost India dearly in terms of billions of dollars of trade deficit they have
caused us directly with Korea or other countries.
"We've been talking to Korea about
opening up their markets for our products, but look at the stark difference, Korea doesn't stop any export of steel from
India to Korea, and neither does Japan, but we can't sell a tonne of steel
in both these countries because
there is a nationalist spirit, which we unfortunately lack," he
said.
He added the production-linked
incentive (PLI) schemes could only help the manufacturing sector to a small
extent as ultimately they needed to be,
Ø competitive,
Ø stand on their
own legs and
Ø provide quality
products to the consumers’.
ST
Extract :
Even though, theoretically, defence production is open to both the
public and private sectors, in practical terms, there is no level playing field,
as the government loads its own enterprises with orders on nomination basis, leaving very little
for the private sector, says Jayant Patil, Member of the Executive
Committee of Management, Larsen & Toubro, and Advisor, Defence &
Smart Technologies to CEO & MD, Larsen & Toubro.
In an exclusive interview to businessline,
Patil said L&T had invested ₹8,000 crore in seven facilities for defence
production years ago; however, the factories’ capacity utilisation is far from
full.
MY TAKE :
Extract :
It just does
not exist - so forget about it and make the most of what you have !
For Corporate , it is absurd to demand and for a Government , it is futile
to attempt to provide a Level Playing Field
There are no two countries where ALL the resources and the
ENTIRE industrial Eco-system , is identical or even closely similar
Inputs for any industry are :
# MANPOWER
* Ave age / Education Level / Skills / Work Ethics /
Productivity / Working
Hours / Holidays /
Salaries
# RAW MATERIALS / COMPONENTS AVAILABILITY
* Local vs Imported / Supply Chain / Logistics /
Duties & Taxes / Quality
# FINANCE / BANK INTEREST RATES
* Equity / Loans / Interest Rates / Collateral /
Duration / Terms
# LAND / LOCATION ( of manufacturing unit )
* Availability / Prices / Transport /
Availability of Skilled Manpower
# INDUSTRIAL POLICY ( Central and State Governments )
* Exemptions / Incentives / Restrictions /
Inspections / Permissions /
Compliance
# MARKET
* Domestic / Overseas
# TECHNOLOGY
* IPR / Patents Regime / Copy-Rights /
Home-Grown / Licensing / Royalty
# TAXATION
* High / Low Corporate Income Tax / Capital
Gains Tax
# INFRASTRUCTURE
* Internal ( Road-Rail Network / Air-Sea
connectivity ) / Warehouses
# COMPETITION
Monopoly / Oligopoly / Cartels / Fierce & Free
competition of many
Now , Industrialists / Businessmen , all over the World , will continue to
compare
the INDUSTRIAL INPUTS existing in their own country with the following
BENCHMARKS :
# Most Business Friendly ................................... Ireland
# Lowest Corporate Tax...................................... Kuwait
( 0 % )
# Lowest Hourly Wages ( PPP basis ).................... Bangladesh
( $ 0.25/hr )
# Highest Working Hours.................................... Mexico
( 42.5 / week )
# Least Govt mandated paid holidays................... USA
( Nil )
# Highest Manpower Productivity......................... Switzerland
# Lowest Bank Interest Rates.............................
Denmark ( 0.05 % )
# Demographic Advantage of a Young Population....India
# Ease of Introducing unpopular reforms.............. China (
Dictatorship )
There is , quite likely , some parameter
on which a Country can claim to have distinct advantage over all the other
countries
It could have something to do with its Geographical
situation / Historical
evolution / Political
System / Legal
Frame-work / Societal Norms etc
It is not possible to replicate advantages of all of these Benchmark
Countries , into any one single country
At the same time , it is very important to keep studying
these Benchmarks and ask ourselves :
" How have these countries managed to reach , where they are ?
What REFORMS can we introduce in our own system to catch-up ?
Are there any parameters in which we ourselves are a
Benchmark to others ?
What should we do so that we do not slip-up where we are
ourselves , some
kind of a Benchmark , to the rest of the World ?
----------------------------------------------------------------------------------------
with regards,
Hemen Parekh
www.hemenparekh.ai /
28 Feb 2023
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