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Arvind Subramanian, India’s Chief Economic Adviser on kitney Acheche Din ( How much of good days)…

30 May

http://www.ndtv.com/video/player/the-buck-stops-here/kitne-acche-din-chief-economic-adviser-reviews-one-year-of-modi-government/368812?hp

Acheche Din ( Good days), has life changed for better, have economic matrices improved…

Please do listen to this delightful interview by the bright and incomparable Barkha Dutt with very personable and extremely competent Arvind Subramanian, India’s Chief Economic adviser for some answers..

Barkha brings a intellectual rigour and is a great interviewer. Arvind Subramanian brings great competence and decency, obviously the prime minister chose very well.

This government is better postioned to deliver than pervious ones simply because they have chosen people well. Every entrepreneur and  great company knows hiring the right people for the job is the most important thing. I have a feeling the current government will come good in delivery.  Arvind Subramanian is a very good choice.  But then Chief economic adviser does not decide the pace of the reforms or the policy making. It is the political executive which decides and the parliament.  Thus it is prime minister and the cabinet who will be accountable for Acheche Din ( Good days). We will wait for the next budget and next year.

I had seen Prime minister ridiculing opposition in a  televised parliamentary debate about  ” MNREGA” , then the next thing finance minister does is increasing the outlay in the union budget. That’s gamesmanship. May be politics does not have new ideas. It must necessarily involve criticism or ridicule of the other. But guess this government has a edge in delivery. I would think this government will spupersede the last government in delivery. I also like opposition’s coinage ” suit boot ki sarkaar” why not ? one gamesmanship must follow another 🙂

The very able chief economic advisor speaks about ” Yes, But narrative” , the perfomance has been good, in the right direction , but there seems to be a disjuntion between, expectations and outcomes, input and outcomes. I am fascinated with this ascription of ” Highly circumscribed power”. If it is so am happy, my sense it is difficult to circum scribe power, but may be its the pragmatism of politics which would eventually and necessarily have to embrace same. I hope some more election losses like Delhi, might help there. Other wise we would have a selfie kingdom.

The Chief economic adviser also mentions the recent data on indirect taxes indicate a underlying dynamism in economy. If the data is consistent then it is indeed a a encouraging sign. Barkha quotes Benjamin Franklin “ there were only two things certain in life: death and taxes” . In India it is the poor who is always blamed for subsidies and rich do not get criticism for all the tax exemptions. Here the Chief economic advisor has the right ideas and does mention the corporate tax exemptions also will be phased out in coming budgets.

The chief economic  adviser makes a mention of  Max Weber ” Politics is strong and slow boring of hard boards” . In respect of taxation, all problems are legacy problems. Be that as it may. The solution needs to be current.

My humble understanding of economics says that though largely free enterprise must be encouraged but state must not abdicate its responsibility of investment and job creation. The infrastructure that is necessary for manufacturing to grow must be created by State. Private investment cannot be relied to create necessary infrastructure. Also large part of India lives in rural india and you must create jobs. That kind of rural income is better than schemes like MNREGA and direct transfer of money. How do you create jobs?

I had seen a NDTV docmentary were young people from villages were given government jobs as ” Home guards” That seven or ten thousand salary will change a family’s destiny. It must set up schools. It must create jobs for teachers. Same for semi skilled, else which Industry will go to villages…

Also the political executive needs to factor a bad monsoon and farmer suicides, Acheche din ( Good days) must be for all…

The good news is India has a very good RBI Governor and Chief Economic adviser, they have both at some stage studied at IIM -A.  So dedicate this interview to  Rahul ( IIM-A) , Namrata & Rajat (IIM -C) who are finishing internship with us, who knows they could be the next Chief Economic adviser or the Reserve Bank Governor..

The Chief Econmic adviser rightly sums up the challenges ” The private investment is a worry, consumption is not as good, public investment ..”

All in all a great interview and very good analysis and questions, the best update on economy, let’s decosntruct ” Acheche Din ( Good days ” with ” Kitne Acheche Din”..:)

I will try to do one more post today.

Have a good day friends!

Love, Suresh

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