question_answer 22)

Recent studies point out that small producer in India need three things to compete better in the market   (a) better roads, power, water, raw materials, marketing and information network.   (b) improvements and modernization of technology.    (c) timely availability of credit at reasonable interest rates.   • Can you explain how these three things would help Indian producers?   • Do you think MNCs will be interested in investing in these? Why?   • Do you think the government has a role in making these facilities available? Why?   • Can you think of any other step that the government could take? Discuss.  

Answer:

These three things will help the Indian producers to compete better in the market as follows (a) Better infrastructure will help them to work more efficiently and timely so that they can compete with foreign companies in the market.   (b) Better technology will help the producers to create better quality products efficiently at cheaper rates.   (c) Better finance will enable them to run their production smoothly without any delays, thus improving their competitiveness.    MNCs will not be interested in investing in these because the Indian producers will then compete with them as equals in the same market, thus reducing their market share. Government must make these facilities available, as they have to provide better facilities for producers as a social responsibility. Government can take many other steps to better facilitate matters by reducing the procedures, i.e., 'red tape' and remove the corruption which is rampant in their offices. Further, they can provide single-window clearance for people wanting to set up production units so that the intending entrepreneurs are not harassed.