Protectionism would deepen recession, delay recovery: India
India has cautioned nations toying with protectionist measures in the wake of the global economic crisis that such a move would not only be counterproductive, but also deepen the recession and delay recovery.business Updated: Jun 19, 2009 13:29 IST
India has cautioned nations toying with protectionist measures in the wake of the global economic crisis that such a move would not only be counterproductive, but also deepen the recession and delay recovery.
"Any kind of protectionism will not only be counterproductive, but deepen the recession and delay the recovery," Commerce and Industry Minister Anand Sharma told reporters on Thursday at the end of his three-day visit for talks with the US officials.
"In our opinion, protectionism is counterproductive for any country, because protectionism at a time when we are talking of kickstarting the Doha development process would actually go against that spirit," he said when asked about protectionist trends in the US.
Protectionism in any legal format would also subvert the multilateral processes and prolong the present economic recession and further delay any turnaround, he said.
All nations do eventually take action and policy measures to uphold supreme national interest, he said, but India is also committed to multilateralism. "We are against protectionist measures."
In the US, there was a lack of comprehension and information, particularly about the services sector which forms a major component of Indian exports, he said. "What is perhaps not fully appreciated is that the outflow of services is evenly matched by the inflow of services."
Noting that of the Fortune 500 companies, 100 have their research and development hubs in India and another 220 are sourcing their software from it, Sharma said, "Do not forget, if India is such a huge IT industry, where does the hardware come from. That is why any protectionist barrier is dangerous."
Referring to a report he released on Wednesday, Sharma said the Indian industry brought in over $106 billion in economic activity to the US last year and created 300,000 jobs. Indian IT industry alone has created 250,000 jobs in America.
"It is reciprocity, which has to be acknowledged and appreciated," he said.