Role of entrepreneur in Import Substitution

Entrepreneur's Role in Import Substitution
Objectives/Aim of Import Substitution.
Economic Growth.
Conclusion.

1. Role of Entrepreneur in Import Substitution A Presentation by :- 1.) Hardik Bhaavani 2.) Sagar Pujara

2. Import Substitution Import Substitution I ndustrialization (ISI) is a trade and economic policy which advocates replacing foreign imports with domestic production. Import Substitution I ndustrialization (ISI) is a theory of economics typically adhered to by developing countries or emerging market nations that seek to decrease their dependence on developed countries and increase their self-sufficiency. It heavily relies on the Internal Resources of a Country. (Note :- ) Do not Confuse ISI with ISI Mark, i.e., Indian Standard Items Mark on various products certified by BIS (Bureau of Indian Standards).

3. Some Points to Import Substitution

4. Import Substitution is in best viewed with the Example of China for the Global Economy. China has almost every product which is a Substitute of its Foreign Counterpart. For Example :- they have their own Chinese version of “Google” known as “ Baidu ”. They have their own version of “Twitter” known as “ Weibo ”. This does not restrict itself to the Technological Industry only but it extends to almost all the Industries in the Global Presence. India is a Country in which there is a heavy craze for Foreign Brands and Multinational Corporations. That is the reason why domestic producers don’t capture a large market share. That is why it is important for us to adopt the Policy of Import Substitution which helps in boosting the Economic Growth.

5. Progress on Import Substitution in India “Make in India” is a type of Swadeshi Movement to encourage companies to manufacture their Products in India. This is a Pure Example of Import Substitution. This Helps in making India a Self-sufficient Country which is able to satisfy its market demand. It also helps in Creating a Global Image for Indian Products in the International Market to compete against Chinese products Globally.

6. Advantages and Disadvantages of Import Substitution Advantages Increased Employment Rate Increases Economic Growth Efficient Utilization of Natural Resources Global Competitiveness Quality-Focused Innovations in Product Lower Cost of Production and Transportation Disadvantages Maybe an Inefficient Unit which results into losses Not having required Technology for Production Lack of Developed Capital Goods Industry to Support the Substitution Results into inequality of Income Distribution (Agricultural Sector) May result into heavy losses for foreign firms who have made the Huge Investment beforehand (Electronic Goods)

7. Economic Growth Many countries view Industrialization as the Pathway for Economic Growth. The Economic Growth is a Problem for Developing countries only and is not a problem for Developed Countries. Import Substitution promotes Industrialization in the Economy. The Main aim of Import Substitution is to Improve and Correct the Balance of Payments in order to emerge as a Self-Sufficient Economy.

8. Entrepreneur – Economic Growth Relationship Entrepreneur’s main task is to Create Jobs and to be in a Job. This is achieved by setting up New Industries in the Economy. The Entrepreneur helps in Efficient and Maximum Utilization of Natural Resources of the Economy which in turn increases the Production Capacity and this leads to an Increase in GDP { Gross Domestic Product } (an Indicator of Economic Growth). Entrepreneurs Direct the Economy towards Growth and Development by enabling Industrialization in the Country.

9. Objects and Aims of Import Substitution fulfilled by an Entrepreneur To promote Domestic Industry at the Expense of Foreign Industry. ( Electronic Goods ) To protect the Domestic Manufacturing and Service Sector. To shift Domestic Income in Distribution in favour of Entrepreneurs and Workers within Industry. To create Employment in the Industrial Sector and Services Sector.

10. Measures of Import Substitution Having a Control on Imports. ( Customs, Duties, Taxes, etc. ) Promoting Foreign Capital and Technology ( Make in India ) to produce the goods of own needs and thus reducing the volume of imports. Entering into New Fields of Industry, Manufacturing and Servicing. ( Innovations )

11. Conclusion

12. So from above, we see the Importance of a Policy like Import Substitution for any Economy of the World. It is a Policy which can lead to Tremendous Economic Growth and the absence of any Policy like it would result into a Weaker Economy. This Policy is what makes America a Superpower and because of this the value of Goods Internationally is Considered in American Dollars $ only. Import Substitution Policy is just as Important to a Country as any of its Taxation Policy. Without such a Policy an Economy would become Economically Weaker and Backward in the World and would be called as a Dependent Country. Example :- Pakistan takes Money on Loans from China. Thus, Pakistan relies heavily on them. India is on the Tracks of Having a Greater Import Substitution Policy (Make in India) but the Fruits of it will be visible in the Long-term.

13. Thank You