PROTECTION 165 



operation of economic laws would tend to pull 

 up the remuneration of the latter in time; but 

 especially in a conservative country like India the 

 process would be slow and gradual; and in the 

 interval an immense amount of hardship and 

 suffering might be imposed on the great body of 

 our Indian workers. A time of transition is always 

 painful ; and in this case it would also be protracted. 



Protection attempts to apply State direction to 

 production. It diverts trade from what may be 

 called its natural channel into an artificial channel. 

 It is often held that if by Protection an old in- 

 dustry is encouraged or a new industry created 

 in a given country, that result is a clear indication 

 of an increase in national wealth. But any such 

 gain may be outweighed by a loss. The industry 

 so artificially created or encouraged has been 

 likened to a pauper. It cannot continue to exist 

 unless it continues to receive dole after dole, and 

 thus it lays a lasting burden on the general con- 

 sumer, and through him on the economic growth 

 of the State. 



Economists have always been inclined to admit, 

 to a limited degree, the efficacy of what is known 

 as the " infant industry " argument, as used by 

 List, Mill, and others, and which is adopted in an 

 exaggerated form by some Indian Protectionists. 

 It is based on the theory that if the failure to 

 establish an industry in a given country on a sound 

 basis is due merely to lack of skill, or to some other 

 obstacle which technically might be surmounted 

 if that industry were granted temporary tariff 

 Protection, it might be advisable to grant it Pro- 

 tection. Economists hold that such Protection 

 would indeed inflict a burden on the community 

 by raising the prices of necessaries, but argue that 

 if the industry in question should, after a limited 

 number of years, be sufficiently firmly established 



