New economic adviser has global repute

New economic adviser has global repute

New economic adviser has global repute

Arvind Subramanian, a fellow at the Peterson Institute for International Economics in Washington, will be the second successive economist of global repute to be appointed as the chief economic advisor in the finance ministry after Raghuram Rajan, who became the Reserve Bank of India governor in September last year.

 Subramanian has worked closely with Rajan when both were at the International Monetary Fund. Soon after his appointment, Subramanian said that macro economic stability and the growth in Indian economy which creates jobs will be his first priority.

His appointment comes at a time when the Indian economy is down with a decade-low economic growth and inflation, which has just started to ease.

 Subramanian has also been a strong critic of Finance Minister Arun Jaitley’s maiden budget and called it a budget prepared by incumbent bureaucrats, not incoming politicians.
 In an article on the Peterson Institute’s website, Subramanian had criticised Jaitley’s first budget as “disappointing but retrievable.”

“In substance, this was a budget prepared by incumbent bureaucrats, not incoming politicians. It represented continuity — which surprisingly was endorsed by much of the post-budget commentary — when the need of the hour was change,” according to Subramanian. But more recently, he criticised the NDA government’s decision to derail a WTO deal struck last year to streamline trade procedures by tying it to a separate controversy over food subsidies.

Subramanian has also flayed the government’s decision to raise import duties on sugar recently calling it an effort to appease local sugar lobbies.

 Earlier, in an open letter to former finance minister P Chidambaram, he criticised him in 2012 for nudging RBI to cut interest rates at a time when inflation was high and other macro economic parameters did not do well.

 Subramanian’s experience and his work on global trade and its effects in developing countries, is expected to come handy at a time when India is negotiating trade pacts with global partners.

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