Assocham Sets Up Panel On Protection To Domestic Industry

The Associated Chambers of Commerce and Industry (Assocham) has set up a panel to study the level of protection available to the domestic industry. This comes close on the heels of the Thapar committee recommendations on foreign investment set up by the Assocham.

Patterned as an informal group, the committee is an answer to months of simmering discontent among industrialists and the chambers managing committee members about the growing influence of multinational corporations (MNCs) in the Indian industrial scene, industry sources said.

Assocham president Babu L Lakshman said the chamber had appointed a working group and detailed inputs were expected in a month.

 

The chambers concern for a level playing field to Indian companies assumes significance against the backdrop of a keenly contested parliamentary election where furthering liberalisation and globalisation has evoked a muted response from leading political parties.

Asked about the terms of reference of the committee, Lakshman said the broad outline would be to explore how the Indian industry could be strengthened without hurting foreign direct investments. Asked about the brewing among various joint venture partner in the country, Lakshman said the industry is still in the early stages of the learning curve with regard to handling foreign partners.

This may be due to differing expectations, cultural gaps and other such issues, he said, stressing that the capital, managerial and technological expertise of foreign companies were vital for the growth of domestic industry.

For instance, the long drawn battle between the government and Japanese Suzuki Motor Corporation last year catapulted the countrys automobile industry into the global arena for the wrong reasons.

Asked whether he would suggest Indian companies to merely buy technology instead of choosing a business partner with a stake, he said it was left entirely to the desire and capability of individual industrialists.

The debate on foreign investments has occupied the centrestage of Indian industry for more than two years now after Confederation of Indian Industry director general Tarun Das lambasted the cowboy attitude of MNCs.

In his report, noted industrialist L M Thapar had called for greater protection to the domestic industry, including putting a cap of 40 per cent on all foreign investments in the consumer goods sector.