Overseas Direct Investment and Foreign Direct Investment can be encouraged, leaving aside the areas wherein such investments can cause troubles. It is to be noted that FDI can bring in the much-awaited prospects of enhanced production means as well as employment. The new government can rethink the duties payable by importers with a view to infusing healthy competition in the domestic market and helping Indian consumers attaining superior-grade goods and services at comparatively low prices. Unorganized employment too is an area of concern. Though such employment trims down the count of unemployed residents; standard of living never boosts up. For instance, youth unable to fetch a salaried job, opts to earn via labor work, which can never uplift the status of living of the Indians.
Another area of concern is the elevating share of the service sector in our GDP. Though India has been the most preferred outsourcing partner of multinational companies since past many years, the more than tolerable share of this sector can mutilate the pillars of the economy. A lesson here has to be learnt from China which has been a hub of manufacturing and is now competing developed nations with hostile outlook.
The solution is not to curb the service sector, rather workable and quick reforms have to be instigated for the furtherance of the manufacturing sector. Import of technical know-how, machines, and new techniques of producing must be encouraged with a view to extending competitive edge to domestic producers. Herein, rethinking of the FDI policy can play a vital role.
The pros and cons of the globalization aspect have to be reworked. The new government shall allow extensive bringing in of technology, however imports in sectors like garments can be limited to help domestic producers reap the advantage of available resources. Import of distinctive goods and services has to be re-evaluated in light of the detriment caused to domestic producers and workforce.
A preferred model can be an assessment in terms of loss of earning prospects for the domestic workforce, and advances in the cost and manner of production. Rather than baselessly following the regulations forced by the WTO, India will have to open new doors and shut those which are prejudicial to the economy. Surely, Mr. Modi and his men will prove talented enough, and will comprehend state of affairs prudently.