How India can become self-reliant

Context: In order to become truly self-reliant, India should rejuvenate investments in public sector undertaking and R&D.

Historical Mistakes 

• Lacked Upgrade: No modernisation in state-run heavy industries and strategic sectors to climb higher up the technological ladder.

• India’s industrial ecosystem was characterised by low productivity, poor quality, low technology, and was globally uncompetitive.

• Missed Third Industrial Revolution: Comprising electronic goods, microprocessors, decentralised manufacturing and global value chains. 

• E.g. India being the world’s 2nd largest smartphone market is nowhere close in its manufacturing

• Rubbished Self-reliance: After liberalisation, self-reliance was reinvented in terms of freedom of import in technologies. Two related ideas that faulted in providing results are:

• Undermining PSUs as sluggish: led to low investments in PSU and hand private sector relied on imports and showed no appetite for technology upgradation.

• Over-expectations from FDI: Foreign major keep strategic knowledge in offshore bases and setting up of manufacturing facilities did not guarantee for technology adoption.

Way Forward: Indigenous Endeavour

• Planned state investments: State-funded R&D, in basic research, by PSUs and research institutions and universities need to be scaled up.
• Upgrade and reorient PSUs: according to present indigenous needs and future evaluation.
• Private sector delivery-oriented R&D: link it to participation in manufacturing at appropriate levels of the supply chain.
• Capture 4th Industrial Revolution: self-reliant capabilities in electric and fuel cell vehicles, electricity storage systems, solar cells and modules, aircraft including UAVs, AI, robotics and automation, biotech/pharma.
• Ramped up public expenditure on Education and Health: No country has achieved self-reliance without mass quality public education and a stronger public health system.