RBI governor Raghuram Rajan warns against make in India
PRime Minister Narendra Modi declared Make in India compaign to boost the manufacturing activities in India. Indian treasury is getting filled with indirect taxes such as service tax and excise, however when it comes to manufacturing China leads the world.
Today in Indian market almost everything is manufactured in China. It seems a good announcement by PM to boost the manufacturing activities.
Why RBI Governer Raghuram Rajan is worried on this compaign? He warned government about Make In India compaign.
Raghuram Rajan is one the biggest economist in world and his concerns are based on the facts. Make In India compaign is announced to make India a manufacturing hub.
RBI believes in natural growth instead of artificial growth. China to become a major manufacturing hub, artificially devalued its currency, kept the wages low etc.
To become a manufacturing hub and compete with China, India has to artificially do all these things and this is a major concern for RBI.
As of now India is one the major exporter of Software products, and to provide cheap labours or resources at low cost India has to devalue its currency. The current products (services) which are being exported will also automatically get reduced.