Change perspective on protection to make India manufacturing hub, says Rajeev Kher

The Commerce Ministry on Saturday said that industry should shed the "archive" perspective of taking protection if they want the country to make it a global manufacturing hub.

Commerce Secretary Rajeev Kher said that Indian industry must enhance competitiveness and align themselves with the modern elements of international trade by promoting and integrating with the global value chains.

"If you want to be a global manufacturing hub, your rules of origin have to be changed. You can't continue to get same protection as you are used to if you continue with that perspective which is an archive perspective in today's production system, then you are not talking of promoting domestic manufacturing," Kher said.

He was speaking at the annual general meeting of PHD Chamber of Commerce and Industry (PHDCCI).

The official said that in most of the free trade agreements, several sectors are protected.

Industry should promote value chains and "promoting value chains require refined or reformed rules of origin. It requires integration with value chains at a point where you derived the maximum advantage of that and that is where the sacrifice is important," he added.

Further on inverted duty structure, the secretary said that there are some sectors which are facing this problem due to free trade pacts.

Inverted duty structure impacts the domestic industry adversely as manufacturers have to pay higher price for raw material in terms of duty, while the finished product lands at lower duty and costs low.