NEW DELHI:You would
normally not expect the government's chief economist to begin a press
briefing on the Economic Survey in what sounded like 'babu' Hindi. But
Raghuram Rajan, the MIT-educated former IMF chief economist, did just
that before switching to a more familiar language, English with a slight
American accent.
The usually reserved engineer-turned-economist was candid as he fielded questions from journalists, admitting that there were downside risks to his 6.1-6.7% growth projection for the next financial year although the overall mood seemed to suggest that the economy looked much better now than a few months ago. "There is a glimmer of a turnaround. The conditions are in place for a turnaround in the economy as we do not expect a global headwind like last year...but much of it we have to do domestically," he said.
Although tennis and squash happen to be Rajan's favourite sports, he used a cricket analogy to argue that the policymakers would turnaround the fortunes. "We are batting on a sticky wicket but the sun will dry out the pitch."
The Rajan stamp was visible not just on the press conference but on the 421-page document as well. While he retained a graph on the annual document's cover, the chief economic advisor inserted a signed introduction to the Survey, with an acknowledgement of key officials as well as external economists.
The overall tone too was less polemical and more gently persuasive, perhaps a reflection of his interest in Indian politics. Rajan, however, did not fail to repeatedly underline what the government needs to do-turn around investment, improve government saving and increase household savings. "There is no silver budget, you have to do a range of things."
Although he avoided any questions that would give a clue to the budget, focusing on the right head while spending was a key element of his fiscal consolidation plan. "No expenditure cut takes place painlessly... In some situations because of the rapid increase in expenditure or at least the Budgeted expenditure of the past years, we have not been able to spend that much or spent as carefully as we might have wanted. So, there is a possibility of shrinking allocation in those areas."
The usually reserved engineer-turned-economist was candid as he fielded questions from journalists, admitting that there were downside risks to his 6.1-6.7% growth projection for the next financial year although the overall mood seemed to suggest that the economy looked much better now than a few months ago. "There is a glimmer of a turnaround. The conditions are in place for a turnaround in the economy as we do not expect a global headwind like last year...but much of it we have to do domestically," he said.
Although tennis and squash happen to be Rajan's favourite sports, he used a cricket analogy to argue that the policymakers would turnaround the fortunes. "We are batting on a sticky wicket but the sun will dry out the pitch."
The Rajan stamp was visible not just on the press conference but on the 421-page document as well. While he retained a graph on the annual document's cover, the chief economic advisor inserted a signed introduction to the Survey, with an acknowledgement of key officials as well as external economists.
The overall tone too was less polemical and more gently persuasive, perhaps a reflection of his interest in Indian politics. Rajan, however, did not fail to repeatedly underline what the government needs to do-turn around investment, improve government saving and increase household savings. "There is no silver budget, you have to do a range of things."
Although he avoided any questions that would give a clue to the budget, focusing on the right head while spending was a key element of his fiscal consolidation plan. "No expenditure cut takes place painlessly... In some situations because of the rapid increase in expenditure or at least the Budgeted expenditure of the past years, we have not been able to spend that much or spent as carefully as we might have wanted. So, there is a possibility of shrinking allocation in those areas."
AMIT KUMAR SINGH
PGDM - 2ND SEM 
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