'India needs to increase economic competitiveness'
Nitte, Karnataka, Mar 4 (UNI) The country has to enhance its competitiveness in all sectors, especially manufacturing, to emerge a global economic player and sustain an overall growth rate of eight per cent, Dr H A C Prasad, Senior Economic Advisor, Department of Economic Affairs, Ministry of Finance.
Delivering the keynote address after inaugurating a national seminar on ''Enhancing India's competitiveness: A Road Map to the Future,'' organised by the Justice K S Hegde Institute of Management here, he said India was considered as the next big manufacturing export centre with a potential to increase exports to approximately 300 billion USd Dollars by 2015.
For this, India should aim at expanding its manufacturing sector gross output to 1.4 trillion US Dollars by 2015. With such efforts, the combined impact of domestic and export-led growth would increase the gross domestic product (GDP) growth rate by one per cent per annum, create 25-30 million jobs in manufacturing and drive in creation of two or three times as many jobs in allied sectors, he said.
This was an assessment of what was possible if Indian companies step up their performances, multinational companies capitalise on the Indian opportunity and the government helped remove obstacles to export-led growth and development, he explained.
Referring to inflow of FDI, he said that though the inflow of foreign direct investment (FDI) in 2004-05 (5.6 billion Dollars) and 3.6 billion Dollars for 2005-06 (April October) were higher than the previous years, this was nowhere near countries like China which attracted 60.6 billion in Dollars in 2004.
He said heavy regulations in business was one of the main impediments in the way of higher FDI into the country. Besides, the country's labour laws allowed firms less latitude compared to countries like China, Brazil and Mexico, he added.
Dr Prasad stressed the need for removal of domestic regulations hardhitting the service sector which account for 54.1 per cent of the country's GDP.
He said that while being a service hub, India could also become a hub for some manufacturing activities like automobiles, auto components, textiles, pharmaceuticals, Biotechnology, Telecom equipment and even IT hardware.
Mr Prasad said in agriculture, India which had been spreaheading the WTO negotiations in the sector on behalf of developing nations, need to quickly take steps to increase supply of agricultural items for world market by increasing productivity. The integrated food laws which was in the offing might be a good step forward, he added.
UNI MA RG GM1853