No Economic Advisors for Modi?

July 20 2014

Narendra Modi may have become the new Sultan of Delhi, but he hasn’t been able to bring alive the expectations of several of his economist friends. Neither the Prime Minister himself, nor the finance minister has a formal list of advisors that includes any economist. As a result, two top Indian economists – Jagdish N Bhagwati and Arvind Panagariya – who had inspired the love of the subject in Modi, are now unable to hide their disappointment from him. It is worth mentioning here that Jagdish Bhagwati had a big role to play in highlighting the economic growth of Gujarat. Bhagwati was considered to be Modi’s economic philosopher, just like Amartya Sen had a big role to play in the implementation of UPA government’s economic policies. Bhagwati and Sen belong to two different schools of thought. Sen believes in socialist economy and is more pro-poor – the UPA policies of subsidies for the poor are inspired by him, the culmination of which can be seen in the Food Security Bill. On the other hand, Bhagwati is all about growth rate and increasing it; he talks about encouraging the manufacturing sector and creating a job for each able hand so that a government’s work is not limited to subsidies, incentives and assistance. Professor Arvind Panagariya of Columbia University also assisted Modi’s journey from elections to the PM’s post in a significant way. But Modi has not taken any steps to make even him an economic advisor. Disappointed, Panagariya wrote a big article in a well circulated English weekly just before the Budget, discussing what steps the government should take. Goes without saying that the finance minister even tried to implement some of them in the Budget. But just this by the Modi government won’t be enough for significant results, though.

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