Question

1) In your opinion, what are the steps that India should take to improve its performance in attracting IPNs?

Answer 1

The first and the foremost step that India should do to attract international production network is

1) Effectively reviewing the preferential trade agreement

With taking inputs from the business people and identifying the areas to gain from regional preferential trade agreement and having a holistic policy effort towards creation of assemblies Centre for global manufacturing.

2) Reduce trade and investment barriers

Allowing automatic route approval for non-strategic sectors through foreign direct investment will help the government in attracting foreign inflows in a Hasslefree manner so that India can be a leader in IPN.

3) Reduce transaction cost of cross-border trade

Minimising the time taken in check post and ports will strengthen the India's Assembling sector thereby reducing the time taken will automatically help to enhance reduction in transaction cost of cross-border trade thereby reducing or eliminating unwonted tariffs or duties imposed on foreign countries.assembling sector thereby reducing the time taken will automatically help to enhance reduction in transaction cost of cross-border trade thereby reducing or eliminating unwanted tariffs or duties imposed on foreign countries.

4) Improving state of physical and institutional infrastructure

Creating infrastructure that supports assembling supplies that can be exported for foreign countries is mandatory so government should invest more money into the physical and institutional infrastructure thereby reducing unwanted taxes, giving concession, clearing the proposals and reducing redtapism.

5) Ease of doing business

Since 2014 government has been consistently improving its rank in the World Bank supervised ease of doing business report and there are certain factors which has to be looked into to improve the foreign investment into the country and letting the foreign companies to do business in a peaceful manner

6) Exit Policy

I step has been taken by the government in this direction in the form of insolvency and bankruptcy code which helps the companies to quit when they are not in a position to handle the business is also a favourable criteria which any company looks when they are investing into a foreign country

7) Special economic zone

8) tax concession and tax holidays.