Yes, you are right. But unlike China India has the option to buy from the Western world. If India goes for reverse eng, that will be a black mark and subsequently restricted from the buying option.
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Yours is a downright valid point.
The problem is that if you buy, buy, buy, then
1) you will never have short-cut, and will always be lagging behind. (BTW, you know who loves this best. It will never be India of course.)
2) you have surplus of labors, including educated labors. They cant get market within India. You have huge amount of unprivileged mass. They are badly in need of the resources. But you channel the valuable resources into West, and you cant keep your talents in your country.