Day 66 – Q 3. Do you think the vision of Atmanirbhar Bharat would be a game changer for the domestic industries? Substantiate your views. 

  • IASbaba
  • August 25, 2020
  • 0
GS 3, Indian Economy, TLP-UPSC Mains Answer Writing
Print Friendly, PDF & Email

3. Do you think the vision of Atmanirbhar Bharat would be a game changer for the domestic industries? Substantiate your views. 

क्या आपको लगता है कि आत्मनिर्भर भारत की दृष्टि घरेलू उद्योगों के लिए गेम चेंजर होगी? अपने विचारों की पुष्टि करें।

Demand of the question – Illustrating upon the vision of Atmanirbhar Bharat, evaluate whether it would be a game changer for domestic industries while also suitably substantiating your views.


Recently, the government announced the vision to make India a self-reliant nation (Aatmanirbhar Bharat) amidst the Covid-19 pandemic, based on the foundation of five pillars comprising economy, infrastructure, technology driven system, vibrant demography and demand.


  • In order to materialise this vision and provide a liquidity boost to the Indian economy for recouping with the loss caused due to the ongoing Covid-19 pandemic, the Government of India, has announced a special economic package of Rs. 20 lakh crores in five tranches
  • The first tranche of the Stimulus Package is dedicated to support micro, small and medium enterprises “MSMEs”. As part of the fourth tranche, the Government announced reforms to provide impetus to sectors including coal mining, minerals, defence civil aviation, atomic energy.

In this regard, the vision of Aatmanirbhar Bharat can be considered as game changer for the domestic industries due to the following factors:

  1. A significant part of the economic dimension of “Atmanirbhar Bharat” is on increasing the competitiveness of Indian production and building connections to global value chains (GVCs). This implies a need to turn away from protectionist policies, while using the lessons from new industrial and trade policy.
  2. Further, following measures have also been announced for MSME’s-
    • Provision of Rs.3,00,000 crores collateral-free Emergency Credit Line for Businesses including MSMEs.
    • Provision of Rs.20,000 crores of subordinate debt for stressed MSMEs requiring equity support.
    • Equity infusion of Rs.50,000 crores for MSMEs with growth potential and viability through Fund of funds and encouraging such MSMEs to get listed on Stock Exchanges.
    • Introduction of a revised definition of MSME, thereby eliminating distinction between the manufacturing and service sector.
  3. The changes in defence and government procurement policies are a clear indication. The obligation to display country of origin on consumer products is another good step to let the consumer decide.
  4. MSMEs will benefit from an array of measures which include easy access to loans and de-risking the sector with a credit guarantee to help banks draw comfort. 
  5. The emphasis on technology-driven systems in administrative reforms, health and education and privatisation of public sector units except in strategic sectors will bring the required efficiencies, thus releasing resources over and above what has been allocated. Opening up of space and atomic energy for the private sector also entails a positive spill over effect of technology.
  6. As the government trains its focus on local manufacturing of solar power equipment as part of its strategy to make an ‘Atmanirbhar Bharat’, Indian solar equipment manufacturers are toeing the line and scaling up capacities.

At the same time, the vision of Atmanirbhar Bharat faces following challenges with regards to domestic industries:

  1. Issues Related to Liquidity: The package of Rs 20 lakh crore comprises both fiscal and monetary measures, where majority of the package is liquidity measures that are supposed to be transmitted by RBI to Banks and Banks to Citizens. This transmission wouldn’t be as smooth owing to inefficient transmission of monetary policy.
  2. Lack of Demand: The lockdown has lowered aggregate demand, and a fiscal stimulus is needed. However, the package, by relying overwhelmingly on credit infusion to boost the economy, has failed to recognise that investment will pick up only when people across income segments have money to spend.
  3. Lack of Backward and Forward Linkages: Unless the rest of the domestic economy is revived, the MSME sector may face a shortage of demand, and its production may soon sputter to a close.
  4. Burgeoning Fiscal Deficit: Government claims that the stimulus package is around 10% of India’s GDP. However, financing it would be difficult as the government is worried about containing the fiscal deficit

Way Forward – 

  • To achieve real self-reliance, the country will also need to incentivise innovation, research and development to keep India at the cutting edge of the industry. 
  • These can be achieved either through the setting up of global innovation centres in India or through partnerships between leading Indian research academic institutions and their global counterparts.
  • Building world-class infrastructure is extremely critical, and this requires huge investments. A strong framework for collaboration (e.g. contracting) and financing such investments needs to be established.


By nourishing local manufacturers, supply chain and with diversification in services and products, the Atmanirbhar Bharat Abhiyan can be made a successful mission where Vocal for Local becomes a rallying cry towards making Indian industries globally competent.

For a dedicated peer group, Motivation & Quick updates, Join our official telegram channel –

Subscribe to our YouTube Channel HERE to watch Explainer Videos, Strategy Sessions, Toppers Talks & many more…

Search now.....

Sign Up To Receive Regular Updates