Former RBI Governor Raghuram Rajan has hit out at Prime Minister Narendra Modi blaming his autocratic functioning for India’s problem on economic fronts. Part of the problem in India is that there is an excessive centralisation of power in the political decision making, he said.
Addressing an audience at the University of California in Berkley on Friday, Rajan said, “India can’t work from the centre. India works when you have many people taking up the burden. The part of the problem is that there’s an excessive centralisation of power in India today.” Rajan also highlighted the recent unveiling of the Statue of Unity of Sardar Vallabhbhai Patel as an example of a massive project that required the approval of the PMO.
Raghuram Rajan also said that Demonetisation and the Goods and Services Tax (GST) were two major ‘headwinds’ that held back India’s economic growth last year adding that the current seven percent growth rate was simply not enough to meet the country’s needs.
“The two successive shocks of demonetisation and the GST had a serious impact on growth in India. Growth has fallen off interestingly at a time when growth in the global economy has been peaking up,” said Rajan, himself an economist of global repute.
He said that India needed to create one million jobs a month. “We are capable of strong growth. If we go below seven percent, we must be doing something wrong. We have to take seven percent as a base to build at least for the next 10-15 years. We have to create one million jobs a month. That’s without addressing the extensive unemployment and under-employment that already exists in the country,” he said.
On the 143rd birth anniversary of Sardar Vallabhbhai Patel on 31 October, Prime Minister Narendra Modi had unveiled the ‘Statue of Unity’ in Gujarat’s Narmada district.Touted to be the tallest statue in the world, the 182-metre tall statue was built at a cost of Rs 2,989 crore. The concrete and brass-clad statue is the quickest to be completed in 33 months, added the PTI report.
The former RBI governor also spoke about the need to clean up the power sector. He said, “For the first time in Indian history, we probably have enough power generation capacity to meet all demands. And yet we have significant blackouts across the country. Why is that? Because we simply have really inefficient distribution system. So, the second short-term target should be to clean up the power sector.”