Lesson in Protectionism

US President Bush recently ended import tariffs on foreign steel in order to avoid retaliatory sanctions by the European Union. But during the period of tariff protection, the US steel industry restructured itself. Many firms closed down or were taken over, says this editorial in India's Business Standard, which increased productivity and resulted in the first large public offering by any US steel firm in the last decade. India should heed this lesson, argues the Business Standard. India, along with the US, is the world's largest user of anti-dumping duties to protect local industries. Rather than using anti-dumping duties, the paper says, the country should increase the use of "safeguard duties", which require that Indian industries write detailed plans to restructure themselves before getting any protection. - YaleGlobal