Topic: Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment
Q5. A calibrated import substitution strategy can strengthen domestic capabilities without resorting to protectionism. Analyse this statement. Evaluate its relevance for India’s export ambitions. Outline a balanced trade policy framework. (15 M)
Difficulty Level: Medium
Reference: NIE
Why the question
Understanding of the evolving trade policy paradigm in India, especially balancing import substitution with export competitiveness in a globalised economy.Key Demand of the question
The question requires analysing how calibrated import substitution can build domestic capabilities without turning protectionist, and evaluating its relevance for India’s export ambitions. It also demands suggesting a balanced and pragmatic trade policy framework.Structure of the Answer:
Introduction
Briefly highlight India’s shift towards competitive self-reliance and the need to align domestic capability with global trade integration.Body
- Calibrated import substitution: Show how strategic and selective substitution builds domestic capacity without distorting markets.
- Relevance for exports: Explain how it supports export competitiveness, value addition and trade resilience.
- Balanced policy framework: Suggest a mix of openness, incentives, institutional coordination and global integration.
Conclusion
Give a forward-looking line on achieving export-led growth through efficiency-driven self-reliance.
