If the economic downturn that India is facing is not treated, “the passing flu”, as many describe it, could end up as a bigger problem that could see the country land in the ICU. This was the consensus among the panellists at the session ‘The Ailing Economy: Passing Flu or ICU?’ at Bangalore Literature Festival 2019 here on Saturday.
Economist Indira Rajaraman, who was a member of the 13th Finance Commission, said that only truth and transparency can get the ailing Indian economy going. India may have jumped from number 77 to 63 among 190 nations in the World Bank’s Ease of Doing Business-2020 report, but a closer look at the data shows that more work needs to be done, she said. She drew the audience’s attention to the failure to enforce contract, which is one of the parameters. Here, India was at 163, near countries such as Afghanistan and Somalia. “Every transaction is a contract and deferred payments have a negative impact on the economy. Failure to enforce contract is a legacy issue in our country. It's high time we changed it,” she said.
Ms. Rajaraman added that the present government was defensive when it came to criticism. “A government should not always be defensive,” she said. Author and investment banker Vivek Kaul also expressed a similar view and discussed the Centre’s refusal to acknowledge the problem. “Real-time income has fallen and there is absolutely no growth in income,” he said. He criticised the government for hiding data from the public.
Senior journalist R. Jagannathan said there have been no big reforms in the country since 1991. “We should move out of fiscal and monetary fundamentalism. Labour, agriculture and land are the most unreformed sectors which are vital. Structural reforms in this sector is urgently needed,” he said. “Non-economic reforms are as important as economic reforms.”
Narayan Ramachandran, investment professional and social entrepreneur, said the economy had enough momentum to move forward, but failed to deliver to its potential.