The real issue is why the Indian economy’s ability to compete and generate profits from external business remains so weak? A concrete answer to this question has not been found, So India’s economic misery will continue to increase.
Why is the competitiveness of the Indian economy so weak that it gets defeated in every trade competition? If the country is in its right frame of mind, it should lose sleep over this question. Fearing harm to India from multilateral free trade agreements, the Narendra Modi government had withdrawn itself from the Regional Comprehensive Economic Partnership (RCEP) agreement at the last moment. The hoax was then made that this was done to avoid dumping of Chinese products through other countries included in the agreement. After that the Modi government adopted the path of bilateral free trade agreements. Such agreements were signed with UAE, Australia, European Free Trade Association etc. Bilateral agreements were being negotiated with many countries including Britain. But now suddenly the government has decided to put an end to all such talks.
The reason given is the huge trade deficit India is facing due to all such agreements made in recent years. The government has also mentioned the agreement signed with ASEAN in 2010, due to which India has continuously suffered trade deficit. Many Indian businesses are said to have been ruined as a result. Modi government has repeatedly asked ASEAN to reconsider this agreement, which it has not accepted. Meanwhile, regarding the much talked about agreement with UAE, it has come to light that in the first half of this financial year, imports from there increased by 52 percent, while exports increased by only 11.45 percent.
Apart from this, a new concern has arisen that due to these agreements, Indian investors have got opportunities to go there and invest, of which they are taking full advantage. Whereas India itself needs big investments. That means loss is loss! So now there is a need to get rid of misconceptions. The real issue is why the Indian economy’s ability to compete and generate profits from external business remains so weak? If a concrete answer to this question is not found, India’s economic crisis will continue to increase.