Sad but true article over @ TCS (TCS ROCKS!) about the latest instance of economic idiocy coming out of India - TCS: Tech Central Station - Wheels of Fortune?
It is rare to find a single story that illustrates, in exquisite detail, all of the varied pro- and counter- arguments for free trade as opposed to managed or protected trade. I am therefore grateful to Peter Foster who filed this piece in the Daily Telegraph from New Delhi. In a nutshell, the Indian Railways Minister, a Mr Prasad, has refused permission to import railroad wheels into India, preferring to establish a factory in his home state of Bihar to make India self-sufficient in their production.
Outsourcing & IT might make the headlines but when it comes to the nitty-gritty improvement of per-capita GNP, lifestyles, health, and so on, it's the boring stuff like logistics that make all the difference.
The cost of not allowing imported train wheels? Well, one of the many costs is quantified -
Analysts predict that it will be many years before India can produce enough wheels to meet demand. The shortage has left 20,000 carriages awaiting wheels, and a similar number of old ones requiring replacements."
This makes my blood boil on so many levels. Idiots.



