I first heard about government entering the business of manufacturing phones when I was (futilely) advising the government of Bangladesh on formulating a national telecom policy. They had some bankrupt telecom equipment factories and I was asked what to do with them. I said, not much. Then my friends in India started to show me numbers for what India was spending on importing equipment for the telecom industry. This cannot continue, they said.
Except for our work on agriculture, most of our activities contribute to the development of the service sector. This is partly because it is the sector that is most dependent on ICT services and because that’s where the investment and growth is, in the countries that we work in. But every so often, industrial policy, or the notion that governments should promote specific industries, including by spending taxpayer money on them, raises its head. I wrote http://www.lankabusinessonline.
It takes guts to question protectionism, but I guess it’s not that difficult when you are in the Prime Minister’s Office: The Prime Minister’s Office is worried about the IT and Communication Ministry’s policy of encouraging domestic manufacturing. The PMO has sent the Ministry a note asking for comments on how the policy aims to link manufacturing requirements to national security. ‘MARKET DISTORTIONS’ “Efforts to link manufacturing with security is questionable. It will lead to distortions in the market. Security objectives can be met through audits, tests and need to be handled separately,” states the note sent by the PMO.