NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News  » Business » 'Protectionism would deepen recession'

'Protectionism would deepen recession'

June 19, 2009 11:42 IST

Union Commerce and Industry Minister Anand Sharma has warned countries trying to introduce protectionist measures that this would not only be counter-productive, but also deepen the recession and delay recovery.

"Any kind of protectionism will not only be counterproductive, but deepen the recession and delay the recovery," Sharma said in response to a question in his interaction with Washington-based journalists at the end of his trip to the city.

"In our opinion, protectionism is counterproductive for any country, because protectionism at a time when we are talking of kick-starting the Doha Development Process would actually go against that spirit," Sharma said.

 Noting that protectionism in any legal format would subvert the multilateral processes, he said such barrier would prolong the present economic recession and further delay any turnaround.

Observing that all countries do eventually take action and policy measures to uphold national interest, he said at the same time India is committed to multilateralism. "We are against protectionist measures," he said.

"There are some issues which are there, which I have raised it with my interlocutors and I am sure that has registered. Some of the areas I feel there is lack of comprehension and information, particularly when you look at the services sector, it's an important component and forms a major component of Indian exports," Sharma said.

"What is perhaps not fully appreciated that the outflow of services is evenly matched by the inflow of services. So that is more important," he added.

Of the Fortune 500 companies, 100 of them having R & D hubs in India and another 220 sourcing their software from the country, Sharma said: "Do not forget, if India is such a huge IT industry, where does the hardware come from. That is why any protectionist barrier is dangerous," Sharma said.

Referring to a report he released on Wednesday, Sharma said the Indian industry brought in over $106 billion in economic activity to the US last year and created 300,000 jobs.

"Indian IT industry alone has created 250,000 jobs in America. So when it comes to H-1B visas, you stretch it to 30,000. It is reciprocity, which has to be acknowledged and appreciated," he said.

"That is why I said any kind of protectionism, will not only be counterproductive, but deepen the recession and delay the recovery," Sharma said.

Lalit K Jha in Washington
© Copyright 2017 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.