India's factory production incentives are not working

Conditions for all businesses need improvement, not just favored sectors

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20230113 mobile production India.JPG

A mobile phone assembly line in Noida in 2020: The production-linked incentive program encourages localized production through heightened import duties. © Reuters

Ritesh Kumar Singh is the founder and chief executive of policy research and advisory company Indonomics Consulting in New Delhi.

To support industrialization, expand exports and increase employment, India launched an ambitious program two years ago to reward participating manufacturers in 14 designated sectors.

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