Many of India's old industries, such as machine tools, general engineering and basic textiles, remain mired in inefficiencies and protectionism.

ECONOMIST: Manufacturing in India

The government's strategy has been to treat imports of capital goods, such as machine tools, relatively generously (to help Kia and its peers improve their manufacturing), while clamping down on imports of western consumer goods, such as cars.

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In manufacturing, innovations such as programmable machine tools make capital equipment more flexible, creating a demand for more flexible human capital, too.

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