Introduction

Literally translated, aatm nirbhar means self-reliant. So when Prime Minister Narendra Modi gave a call for Aatm Nirbhar Bharat, he was calling for a self-reliant India. This seen in  a narrow sense is not cause for excitement. After all, self-reliance is an evident goal for any economy, which means no economy should depend on largesse from external sources for survival. Indeed, in this same narrow sense, if an economy is exporting enough to pay for its imports, it is self-reliant. The slew of government announcements after this call were conventional ones aimed to support and revive India's hard hit businesses particularly the MSMEs. But the fact that Mr Modi had a much broader vision in mind became clear soon enough when he talked about being “vocal for local.” It is this Aatm Nirbhar Bharat the contours of which are outlined here and the implications for such a goal for India at large. It is argued here that Aatm Nirbhar Bharat is about the mainstreaming and modernising India's bewilderingly rich and myriad local and traditional commodities, services, medicines, etc. and as a logical corollary the traditional and local knowledge systems and technologies traditionally go with such items and services. It is about recognising our core strengths hitherto neglected, and amplifying the same with modern scientific and business knowhow by promoting what has been locally successful at the national and international level.

What is Aatm Nirbharta? Towards a deeper view of Self Reliance

Is there a reason, why a country that experiences both rising living standards and does enough exports to pay for its imports may yet not be aatm nirbharta or self-reliance? There are a number of factors that have to be considered when it comes to gauging the vulnerability of an economy to contingencies beyond its control. Consider the oil exporting economies of the Middle East. While some of them may be high income economies and enjoy trade surpluses, their fortunes are based precariously on the future of hydrocarbons. Should there be a precipitous or even a secular decline in their prices either due to excess supply or declining demand, the self reliance of these economies will come to an end rather quickly. Indeed, any economy that has a narrow export basket or exports goods only on the basis of cost will find itself constantly under pressure from either changing demand conditions or undercutting by other countries with lower wages. Any meaningful concept of self-reliance has to factor in the above. But, it has to go much beyond considerations of a country's external balance!

Indeed, for a country like India, aatm nirbharta ie self-reliance is to be drawn from India's internal resources both natural and cultural and indeed it huge trove of traditional knowledge. One of the natural outcomes of the market mechanism and globalisation coupled with scale economies in production is the disappearance of a vast variety of goods and services that served local markets. For example, entire spectra of crop types, be it cereals or pulses, have been replaced by a much more homogenised structure of cultivation with monocultures being the norm in many cases. Earthenware goods have been replaced by plastics and other composites. Natural fabrics and clothes too have been replaced by synthetics. When it comes to provisioning for services like water, traditional systems that harvested water have been replaced by capital intensive mega-schemes. While in the short run, these developments appeared natural and beneficial, it is now clear that in most cases these were the outcome of market distortions that hid both long run and short run costs and overstated benefits. These have led to outcomes that in many cases have left communities and indeed the country at large extremely vulnerable, especially when it comes to water-stress. All this has led to a higher cost agriculture and thus a high cost economy.

Equally India so far has not taken advantage of the huge treasure trove of local goods/items that were traditionally crafted by local artisans to create either  a national or international market for such goods. India's traditional systems of medicine have been marginalised towards more modern systems even when the efficacy of the former and the pitfalls of the latter have become increasingly known. All this again seeks to increase India's vulnerability in many dimensions. The aim of Aatm Nirbhar Bharat is to reverse this trend towards vulnerability by promoting local artisanship and traditional knowledge by marrying it with modern technology, investment and business practices to mainstream what was local into processes that become national and international.

Why and How does India move towards Aatm Nirbharta?

Why should India move towards Aatm Nirbharta? Why should she be “vocal for local” ? It is clear from India's chronic trade deficit that India fails even the most simplistic test of of the self-reliance. It can be argued this is a consequence of not playing to her strengths; indeed our major export items hardly reflect anything that is uniquely Indian. Moreover, when it comes to items like apparel, we are increasingly trapped into an undesirable cost competition with low wage countries like Bangladesh which implies that export expansion  will  not be possible with low income jobs. When it comes to agriculture, productivity gains are tapering off. Rising cost conditions are leading to stress in this entire sector. When it comes to healthcare, the existence of a system which derives its origin from conditions in Europe and America leads to inappropriate solutions that are capital intensive and often leads to drugs resistance. Our food habits, increasingly influenced by the West are leading to lifestyle diseases. Clearly we need to revisit the distortions in governance, markets and the process of globalisation that have led us to this pass.

India needs to transform the vulnerable nature of its economy into  one that is capable of delivering improving living standards in a sustainable manner without being excessively dependent on conditions / contingencies / events in other parts of the world. Its supply chains as well as markets should be insulated from such shocks, and India's size makes it eminently possible for both supply and demand to be sourced domestically, ie become aatm nirbhar or self reliant. This is by no means a call for autarky. Nor is this a call for crude import substitution strategies.

This is a strategy to reorient our economy to reflect and amplify its strengths, cultivate crops and produce items and services rooted in India's communities and traditions. These could range from fruits to medicinal plants to culinary preparations to traditonal medicines. The idea is to create a market for such goods by promoting them ie going “vocal for local” both nationally and internationally, thus creating a spectrum of niche markets where these goods and services are sought for their uniqueness rather than cost competitiveness alone. It taps into the willingness of customers to pay for products that are novel and/or aesthetic and sustainably produced without price considerations as the only yardstick. These could be traditional Indian fabrics or traditional apparel made from such fabrics. These could also be Indian traditional medicines/health products which could be a serious alternative to expensive modern medicines without their side effects. These could be various types of Indian cuisines prepared for the modern world. Clearly the goods described above have vast potential markets both domestically and abroad.

The above mentioned strategies require modernising the production processes which are labour intensive and traditional by which these goods and services are created by modern interventions into traditional knowledge. Leveraging traditional knowhow is also an aspect of  knowledge economy where wealth is created through exploitation of knowledge. Therefore, the protection of this knowledge requires a  strong intellectual property rights policy in terms of patent protections, geographical indications, trade-marks, etc. to ensure that that this knowledge is not appropriated by foreign companies and patented as their own. It requires promotion of these goods and services, and brands under which these goods and services are sold. It also needs setting up of supply chains that is able to cater to this demand when it is created.

Indeed, being “vocal for local” means that even local governance practices, for example husbanding of common property resources like water, that are successful are to be promoted so that they are replicated whenever possible. Such practices lead to sustainable provisioning for public goods, saving of resources and increasing of  productivity.

Aatm Nirbhar Bharat: Summing Up

The aim of Aatm Nirbhar Bharat is not to draw India into a shell. On the contrary, it is a call for the reorienting the terms with which we have engaged with globalisation so far. India has engaged with the globalisation in the past where vital parameters like technology on terms set by others. An Aatm Nirbhar Bharat offers to its own citizens as well as the world goods and services that are its strengths. These are to be produced with a knowhow that is India's own. This is effectively resetting the terms on which India competes with the rest of the world and prevents India from entering a trap where competition occurs mainly on the basis of costs and thus is structured towards a regime which wage rate growth is low. More importantly, the reorientation of the Indian economy towards its own strengths benefits the people of India who are and should be the main focus of such an effort by increasing employment opportunities and providing a basket of goods and services that are suited to Indian conditions.

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