Issues in Brief, No. 23, April 2012

23-IIB Free Trade India Economy Free Trade and Inclusive Development: Lessons from the Indian Experience

By Suranjana Nabar-Bhaduri
April 2012 (8 Pages)
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Can trade liberalization result in long-term economic growth for developing countries?  In this Issues in Brief, Pardee Center Post-doctoral Fellow Suranjana Nabar-Bhaduri argues that the experiences of Latin America and, more recently, India, have shown that liberalization must be complemented by industrial and employment generation policies if the process of economic growth is to be made more sustainable and inclusive.  She compares both the policies in place and the employment and productivity numbers for pre- and post-liberalization India, and suggests industrial and employment policies need to be coupled with trade liberalization for a positive outcome. She concludes “…striking a balance between liberalization and active industrial and employment generation policies is vital to generating a long-run development path that is both sustainable and humane.”

Suranjana Nabar-Bhaduri is a Post-doctoral Fellow at the Frederick S. Pardee Center for the Study of the Longer-Range Future at Boston University. She specializes in development economics, international economics, and the Indian economy.