Not self-reliance, focus must be on 'competitive India'

The President said that the Fundamental Duties enshrined in the Constitution are essential obligations of every citizen towards making Bharat a developed nation when it completes 100 years of freedom

In her customary address to the nation on the eve of the Republic Day, President Droupadi Murmu said that this is the time of an epochal transformation. Many would associate this statement with the words of the Prime Minister three days earlier at Ayodhya that this is Bharat’s time and Bharat is now going to move forward. Many others would look at the march of technology and how it is transforming the way we live. Some others would pause to reflect on the road travelled, take stock of the present situation and focus on the tasks ahead. 

The President said that the Fundamental Duties enshrined in the Constitution are essential obligations of every citizen towards making Bharat a developed nation when it completes 100 years of independence. It is worth recalling that one of those Fundamental Duties is to develop a scientific temper, humanism and a spirit of inquiry and reform. She also talked of equality of opportunity and realisation of our cherished ideal of equality. It is pertinent to recall one of the Directive Principles of State Policy that requires the government to direct its policy towards securing the operation of an economic system that does not result in concentration of wealth and the means of production to the common detriment.

The President said that India is moving ahead with confidence, which comes from and is also reflected by the robust health of the economy, that our GDP growth rate has remained the highest among the major economies in recent years and that we have all reasons to believe that this extraordinary performance will continue in the year 2024 and beyond. While few would disagree with that view in the context of slowing economic growth rates in the developed countries, it is worth noting that the average growth rate for the last ten years is 4.3 per cent against the growth rate of 6.2 per cent in the previous ten years.

Our merchandise exports at a record $ 456 billion in 2022-23 constituted barely 1.8 per cent of the global merchandise exports. In 2023-24, our estimated merchandise exports are likely to shrink to $432 billion based on the April-December 2023 figures put out by our government. In 2013-14 our merchandise exports were $313 billion. So, in the ten year period, the compounded aggregate growth rate of merchandise exports is likely to be only around 5.1 per cent. If we leave out the exports of high value items like petroleum products and gem and jewellery it is likely that the export figures for other goods could be even more disappointing. In recent years, especially after the downward revision of income tax rates in 2020, our exports of services have grown but those figures must be seen in the context of the fact that besides inward remittances against invoices, there is no real evidence of exports, as in the case of export of goods where there is a shipping bill that goes through the Customs.

The reality is that despite the government’s efforts to build infrastructure and bring down the logistics costs, we have not yet become globally competitive. Responding by erecting more and more tariff and non-tariff barriers will not help. We have to abandon our aim of ‘self-reliant India’ and strive for ‘competitive India’, if we aspire to become a developed country by 2047.

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