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Positive impacts

  • Companies do not hesitate to undertake restructuring, merging and acquisitions
  • Many industries now cater to the world market
  • There is a rise in quality and cost consciousness of Indian workers
  • There is a shift from labour-intensive to capital-intensive method of production among entities
  • Trade unions and workers exhibit little or no hostility and pressure
  • Owing to better facilities and support for exporters, there has been a rise in value added exports
  • There has been an upward trend in quality, R&D, technological growth and productivity
  • Corporate now focus on aggressive brand building to find their spot in an increasingly competitive market place

Negative impacts

  • Insufficient fiscal discipline: In India, the fiscal deficits are very high and there is a need to reduce them by improving the administration of taxation, reducing subsidies, re-prioritization of plan schemes, more privatisation and such other means.
  • Non-implementation of industrial deregulation: Sectors which are reserved for Small Scale Industries (SSI) have grown slowly when compared to the unreserved SSIs. Thus, it calls for an immediate de-reserving in these areas, especially the ones which have a strong potential for exports.
  • Foreign trade measures: India should identify the major tariff anomalies and come out with a detailed programme listing a phased programme for their elimination. Our anti-dumping mechanism and procedures should also be strengthened so that Indian industries do not have to unfair competition.
  • Unplanned disinvestment: Privatisation and disinvestment being crucial factors in influencing an economy have been carried out in an unplanned manner. This has given birth to suspicion in the minds of public. Hence, the rationale behind and the manner of disinvestment should be made transparent.
  • Infrastructure growth: The quality of infrastructure plays a crucial role in the growth of an economy. However, our infrastructure that consists of telecommunication, power, ports, roads etc. is not only inadequate, but also deficient in quality.

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