Protectionism is on the rise in advanced economies but the trend can be reversed by the opportunities offered by emerging markets like India, Bharti Enterprises Chairman Sunil Bharti Mittal said on Wednesday.
“Those voices that were urging India to open up its economy to foreign direct investments, to trade, to bringing in products in finished form in this country, have succeeded to some extent in getting our countries open…
“However, the same countries, who are advanced economies, US and Europe and many other pockets of the world, are suddenly turning around and talking about protectionism,” Mittal said at the convocation ceremony of Institute of Management Technology here.
He said at the World Economic Forum, after opposing global trade for a decade, first time a Chinese leader, President Xi Jinping, asked the Western world to open their economies for more trade, which indicates that China has been hit by the slowdown.
“Then you move to the issue around election of President (Donald) Trump, issues around Brexit….They all suggest xenophobia is on the rise, anti-immigration is on the rise. These don’t hold good promise for young Indians who are passing out today,” Mittal said.
He said that leaders in India will have to create support at the World Trade Organisation (WTO) to ensure movement of people is not restricted and the country does not become a dumping ground for global products.
“India made a proposal to WTO on TFA (trade facilitation agreement) for services, which is counterpoint to TFA in goods and products. (It) has been now endorsed by required majority in the world and is now likely to become law under WTO,” Mittal said.
“I believe the world will have to alter the discourse of talking against immigration. There is wave against immigration today but I have no doubt given the size and scale of market that we offer in return for their goods, they will have to relent on services as well,” Mittal said.
Mittal said global growth has slowed down and there is a dynamic shift in the polity and economics of the world.
“For the last five years, the world has seen a growth rate of less than 3 per cent…This is a record low over several decades. If I look at 1920 downturn which melted the whole globe, after that probably we are witnessing very lean period in global growth,” Mittal said.
He said that India needs to stay ahead in services so that many young people who graduate from here and skilled people from villages have the right to work across the globe.
Mittal, who is also the Chairman of International Chamber of Commerce, said that he is personally leading the issue of TFA for services not only on behalf of India but for all those regions which have a younger population like the Middle East, Africa, Sri Lanka, Bangladesh and Indonesia.
He said there is too much turbulence in the global economy but students in India are coming out of a nation that has immense opportunities and is “very safe and equally vibrant territory”.
Mittal said that while the growth of economies around the globe, including US and China, have slowed down, India stands tall with nearly 7 per cent growth rate.
He said that India has lot of consumption demand left in its economy and offers tremendous opportunities.
“India, which has lot of growth still left in its economy, which has to build massive amounts of infrastructure, right from the basic to most innovative infrastructure, offers tremendous opportunities,” Mittal said.