What is export promotion and import substitution?

The strategy uses tariffs, import-quotas and subsidies to promote and protect import-substitute industries. In contrast, an outward-looking strategy emphasises participation in international trade by encouraging the allocation of resources in export-oriented industries without price distortions.

What is the import substitution model?

Import substitution is the idea that blocking imports of manufactured goods can help an economy by increasing the demand for domestically produced goods. [2] Other countries such as China, India, and even the United States seek to promote domestic manufacturing and exclude imports from the market.

What is the meaning of export substitution?

Export-oriented industrialization (EOI) sometimes called export substitution industrialization (ESI), export led industrialization (ELI) or export-led growth is a trade and economic policy aiming to speed up the industrialization process of a country by exporting goods for which the nation has a comparative advantage.

What is import substitution class 12?

Import substitution means substituting imports with domestic production. Imports were protected by the imposition of tariff and quotas which protect the domestic firms from foreign competition. Impact of Inward looking Trade strategy on the domestic industry.

What is import promotion?

Import-promotion policies are measures intended to increase the volume of a country’s imports from a particular trading partner or group of trading partners. By promoting imports from one specific source, VIEs allowed imports from the favored source to displace lower-cost exports from other countries (trade diversion).

What is import substitution policy of India?

‘Import Substitution’ (IS) generally refers to a policy that eliminates the importation of the commodity and allows for the production in the domestic market. The objective of this policy is to bring about structural changes in the economy.