Dr. C. Ranagarajan noted economist, former Governor of the Reserve Bank of India (RBI) and the erstwhile state of Andhra Pradesh gave a lecture on the Developmental Issues of the Indian Economy at the University of Hyderabad (UoH) on 30 October 2014.
Dr. Rangarajan while delivering the valedictory function address for Refresher course in Economics congratulated the academic staff college, UoH for regularly conducting these refresher courses for teachers to update them with contemporary developments in the field. He observed that with ever increasing relevance of economics to deal with issues in many other dimensions that were not considered part of the discipline traditionally, it becomes extremely important to update and upgrade basic understanding of the principle of economics for the society. Recent time has also witnessed development of specialized disciplines in the domain of Economics to deal with variety of matters in various areas.
Dr. Rangarajan based his lecture on the issue of immediate concerns and future challenges specific to Indian economy. After liberalization in 1991, India has been on a fairly good growth path with last decade being the period for most impressive growth period so far. However in recent few years this growth rate has come down due to variety of reasons that include external shocks due to financial crisis at the global level as well as weakening of investment climate due to animal spirit and other bottlenecks. He mentioned that delay in projects completion, lack of critical inputs such as power coupled with decline in savings rate and investment rate have been responsible for the decline in economic growth.
Dr. Rangarajan mentioned that there issues are not merely micromanagement issues but have a lot to do with our policies and the level of their facilitative vote for the economic growth. He emphasized that issue of environmental depletion is extremely important but there must also be rational understanding of our willingness to see such issues in light of the need for required economic growth for socio- economic growth in the country. For example coal serves as major input for power that forms base for industrial growth. During 12th plan for 8-9% of growth power required was estimated to be 1 lakh megawatt but only 20,000 mega watt could be availed. We must be able to take care of such huge mismatch.
Dr. Rangarajan added that our policies must be facilitative. He appreciated the philosophy behind the land acquisition act and supported the fairness of price to be paid to land owner. However he mentioned that the act must also take care of completion of such acquisition without much delay.
Dr. Rangarajan told that price stability, low current account deficit and fiscal stability are crucial for sustained economic growth. He told that monetary and fiscal policies also have role to play even if the inflation is caused by food inflation. In recent years, the food inflation has been triggered by on or other sub-group of food such as vegetable, meat and milk also and not only the food grain. Given the recent impact of food inflation on our economic orientation, we must be able to give due emphasis to a sustained growth in agriculture sector. As a substantial part of our population is associated with agriculture, it’s doubly important. In particular, emphasis has to be on productivity enhancement and good marketing facility. He mentioned that growth and equity of development must be seen in togetherness development ceases in absence of growth. If we continue to grow at 8%-9% rate for a decade and so, we can expect to be in group of middle income group countries by 2025. So growth is a pre-condition to fulfill our aim of inclusive development and true welfare of our countrymen.
He mentioned that extraordinary level of import of gold in India has also contributed to undesirable economic management. Apart from great affection for the yellow metal due to cultural reasons in recent years it’s also being used a hedge resource. Some policy intervention in this direction has helped in certain way.
Concluding his lecture, Dr. Rangarajan reiterated the importance of idea, governance and execution for proper economic outcome. We can achieve aspirations of our people through sustained support to the pro-poor social welfare programmes only when we have economic growth that can result in resources to be distributed. In this light, our policies and orientation must facilitate each other with affirmative transactions and realistic approach.
Prof. Ramakrishna Ramaswamy, VC, UoH presided over the function. Chancellor of UoH, Prof. C.H.Hanumanth Rao, Pro VC of UoH, Prof. E Haribabu, Dean, School of Economics, Prof. G. Nancharaiah and many other faculty, staff and students attended the lecture. The program was also attended by 23 teachers from A.P., Telangana, Maharashtra, Karnataka, were part of the refresher course in Economics organized by the Academic staff College, UoH during October 10-30 October 2014.
– Kumar Ashish, Research Scholar in Economics