In most countries, governments are becoming more and more involved in industrial policy. in a piece for Mint, Dr Niranjan Rajadhyaksha, Executive Director, Artha Global, argues that for such intervention to work well, government policies need to be consistent and economically sound.
Excerpts below:
“There have been several different experiments in industrial policy over the decade—some successful, some disastrous. Even the success stories are told in different ways, especially in the case of the Asian miracles east of our borders. The IMF economists have likened this to Rashomon, the classic film made by Japanese film director Akira Kurosawa on the subjective nature of truth. Picking the correct lessons is important for India as well, especially since its earlier tryst with industrial policy did not work too well.”
“Early Indian nationalists of all hues were broadly in agreement that the state would have to play an active role in driving economic development after independence was achieved, though there were differences in the details. In 1950, the two most important models to follow were those of Japan and the Soviet Union.”
Read the full article here.
