India Inc also responsible for trade issues with China: EAM

PUNE: External Affairs Minister S Jaishankar on Thursday said the responsibility for the trade imbalance with China rests squarely on businesses as well, blaming Indian corporates for not developing the right sourcing arrangements.

Speaking at the Asia Economic Dialogue here, Jaishankar said the government is doing its bit by bringing in policies like the thrust on Atmanirbhar Bharat and made it clear that the “massive external exposure” puts national security at threat.

Terming the challenge posed by the trade imbalance with China as very serious and formidable, the career bureaucrat turned politician said the responsibility here is not just of the government, but it is an equal responsibility of businesses as well.

“Indian corporates have not developed the kind of backwards (integration), vendor supplies, components and parts, ingredients and intermediates that should be supporting us,” he said.

Acknowledging that the government is also to be blamed for such a trade imbalance, Jaishankar said the self-reliance motto is a corrective step taken by the administration after the flaws that got exposed during the COVID pandemic.

“Atmanirbhar Bharat it is not a slogan. It is actually a messaging to (the) industry, to people saying, please, what you can source from India, you have an obligation to source, not as a moral obligation. Our national security is at threat if you have this kind of massive external exposure,” the career diplomat-turned-politician said.

With lots of people, including former RBI governor Raghuram Rajan, asking India to focus on services, Jaishankar warned that those who “do down” manufacturing are “actually damaging India’s strategic future.”

In an apparent reference to Pakistan, the minister also said no country can come out of its problems and emerge prosperous if its “basic industry” is terrorism.

Replying to a question on whether India will be helping its western neighbour facing troubles, Jaishankar said terrorism is the fundamental issue of the India-Pakistan relationship, which one cannot avoid and “we cannot be in denial of the fundamental problems”.

“No country is ever going to come out of a difficult situation and become a prosperous power if its basic industry is terrorism,” he said.