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Computer chips
One of the oft-repeated shibboleths of reform is that it should benefit the consumer. This has been used to justify all sorts of things, like the entry of consumer goods giants like Pepsi and Coke into the country. Nike, Reebok, Kelloggs, Kentucky Fried Chicken et al are supposed to help the average Indian onwards in his quest for the consumer nirvana. What has been ignored in the process is the fact that man is not merely a consumer, but also a producer.Just as an individual decides whether he should consume today or put off some consumption to save for the future or invest in, say, a computer course or an MBA degree, a country too will be required to choose between bread for its citizens today and cake tomorrow. An individual is perfectly aware that he will be able to increase his purchasing power if he postpones immediate consumption for investment in human capital. Given a choice, he or she will also choose certain activities over others -- he would, for instance, prefer to be an engineer than amechanic, or a doctor rather than a nurse. In exactly the same fashion, a country too will need to choose certain activities rather than others, simply because such activities will enable the nation to earn more in the long-run. This, in a nutshell, is the rationale why India as a nation should favour investment in computer chips rather than in potato chips. It may be correct to say that there exists a need for potato chips and therefore that need must be satisfied. However, economic resources are limited and they must be utilised in activities that will ensure a brighter future for the country rather than in those that merely create an illusion of prosperity.
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