MODERNIZATION AND PRIVATE INTERESTS

Extract

VISITORS TO INDIA over the past several decades have often remarked on the shoddy quality of many of its manufactured goods. How could a country with large numbers of talented engineers and business-people keep on reproducing, decade after decade, a more or less unchanged version of the British Morris motorcar from 1955? The answer beloved of liberal economists is simple: protection of the Indian car industry from international competition. The solution: remove protection.