17 June, 2012


June 17, 2012
A mail is doing rounds appealing to Indians to boycott foreign products - from shaving blades to shampoos, shoes to shirts, so as "to boost the Indian economy".

Clearly this well-intended mail is based on ill-informed economics. And on a jaundiced notion of citizenship. Here are some questions:

- what is the share of foreign investment in the so-called Indian companies?
- how patriotic, humane, socially conscious is the patronized company?
- what is the extent of CSR [corporate social responsibility] work being undertaken by a particular MNC in India?
- what is the extent of the investment being made by that company in India's infrastructure development?
- what is the pricing policy behind a particular product / service? What if the MNC product offers greater value at lesser price compared with an 'Indian' company? What about the disguised loss thus incurred by the Indians?
- if Indian small scale industries start buying their generators, turbines, furnaces, thermal control switch gear etc of inferior quality from Indian companies boycotting foreign companies under this logic and consequently produce fewer and shoddy products, how would the Indian economy benefit?
- what if other countries, too, start boycotting Indian products, shunting out Indian professionals, regardless of obligations under treaties and conventions for open trade and free movement that most nations have signed?

In such a globally integrated economy as ours, where Indian MNCs are significant global players themselves, such parochial ways may only be counter-productive besides being bad economics.

Personally to me more efficient administration, a full day's honest work at offices and factories by all Indians, stricter conservation of resources, better distribution of income, diversification of resources towards more productive purposes, total ban on production-impairing activities like Bharat bandh, go slow, work to rule, strikes etc would appeal better.

And to you?

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