NEW DELHI: RBI governor Raghuram Rajan on Friday cautioned the government, in reference to Prime Minister Narendra Modi’s “Make-In-India” campaign, that what worked in China’s case may not always work for India.
He said India should not focus only on manufacturing, saying the export-led growth achieved by China and some other Asian economies may no longer be possible.
The RBI chief pushed for incentivising domestic savings to boost investments.
“The income-tax benefits for an individual to save have been largely fixed in nominal terms till the recent Budget, which means the real value of benefits have eroded.
Some budgetary incentives for household savings could ensure investment is largely financed from domestic savings,” Rajan said while delivering the Bharat Ram Memorial Lecture here.
On the Make-In India campaign, the RBI governor said when India pushes manufacturing exports, it will have China to contend with.
“I am cautioning against picking a particular sector like manufacturing … simply because it has worked well for China. India is different, and we should be agnostic about what will work,” Rajan said. – From The Asian Age