Minister of State for Electronics and Information Technology Rajeev Chandrasekhar on Thursday (June 15) attacked an eight page post by former Reserve Bank of India (RBI) Governor and University of Chicago Professor of Finance Raghuram Rajan, questioning the economist’s understanding of electronics supply chains, semiconductors, and of economics itself.
The original eight-page note, posted by Dr. Rajan and two others on LinkedIn, scrutinised the Union Government’s Production-Linked Incentive (PLI) scheme for mobile phone manufacturing, which when combined with 2018 tariffs on imports of mobile phone parts, has led to increased exports of mobile phones.
Dr. Rajan and his co-authors, Rahul Chauhan and Rohit Lamba, argued that import data, even with accommodating assumptions, showed that net exports of phones remained negative, as most components continued to be imported, and assembly alone added little value to phones — as little as 4% of the manufacturing cost, and even smaller as part of the retail price.
