Archive · 16 Sep 2025
Industrial Policy's Resurgence: Global Trends and National Strategies
Industrial policy is when governments help certain industries or companies.
After being out of favor, it's making a comeback.
Countries are using it to guide their economies, like choosing which cars or technologies to focus on.
China spends a lot of money this way, offering subsidies and tax breaks.
India uses schemes to boost industries like mobile phones.
The goal is to guide how money is used, which could help or hurt economic growth, and whether to produce important goods within a country's borders.
Industrial policy, involving state intervention in economic structure, is gaining popularity.
Interventions in industrial policy rose dramatically from 2010 to 2022.
China is a global leader, allocating 4.4% of its GDP to industrial policy in 2023.
China utilizes cash subsidies, tax benefits, subsidized credit, and land for industrial policy.
India uses Production-linked incentive (PLI) schemes, and subsidized land.
- Who
- Nations globally, including China and India
- What
- The revival and implementation of industrial policy
- When
- Since 2010, with significant growth by 2022.
- Where
- Globally, with key examples in South Korea, Malaysia, China, and India.
- Why
- To shape economies, correct market failures, and build domestic capacity.
- Definition
- State intervention to shape an economy's structure.
- Global Trend
- Industrial policy interventions increased 30-fold (2010-2022).
- China's Spending
- 4.4% of GDP in 2023 on industrial policy.
- China's Methods
- Cash subsidies, tax benefits, subsidized credit, and land.
- India's Approach
- Production-linked incentive (PLI) schemes and subsidized land.