A pointless debate

No need to invoke the phantom of the foreign hand

Rajiv Kumar, National Institution for Transforming India (NITI) Aayog’s vice-chairman-designate, stirred up a vociferous debate on Tuesday by suggesting in a newspaper column that “the grip of Indian-American economists is fading as part of the ongoing policy transformation in the government”. He then went on to name the outgoing chairman of the NITI Aayog, Arvind Panagariya, and the former governor of the Reserve Bank of India (RBI), Raghuram Rajan, as examples of this trend. In fact, he also hinted that many more such resignations could be on their way and incumbents might be replaced by economists who better understood “India’s ground realities”. This is quite a claim as it, quite unnecessarily, invokes the phantom of the foreign hand and asserts the existence of a deliberate exercise to weed out all those economists who have spent a better part of their career abroad. Considering that Mr Rajan parted ways with the government on a sour note last year, Mr Kumar’s linking it to Mr Panagariya’s resignation could lead many to speculate on the actual reasons for the latter’s exit from the NITI Aayog. Moreover, the suggestion that other similar resignations might be on the way will lead to speculation about the future of many other individuals who are in important positions in the finance ministry and the RBI. Bibek Debroy, NITI Aayog’s member, was quick enough to tweet a limerick, apparently to mock the foreign influence jibe.

 
It is unclear what made Mr Kumar write what he did, but it was certainly not in good taste. There is also absolutely no merit in the notion of provenance playing a part in an economist’s ability to guide policy. For one, like so many of the so-called foreign economists, Mr Kumar himself holds a DPhil in economics from Oxford and has done stints at the Asian Development Bank in Manila. Surely, there is no formula to determine the exact number of years an economist has to work in India before he/she can claim to have enough knowledge about the country’s ground realities. Also, it is facile to assume that only home-grown economists are better qualified to frame policies for India. Clearly, as former chief statistician of India, Pronab Sen, suggested in this newspaper on Tuesday, it is not an issue of whether home-grown economists are better than those who have worked abroad, the real issue is their axiomatic approach to the subject. A market fundamentalist, irrespective of his place of birth, will argue against any interference by the government, while a Keynesian will frame the opposite policies. 

 
Mr Kumar’s observations are also not in sync with the NITI Aayog’s vision document, which states that India’s continuing integration with the world needs to be incorporated into the country’s policymaking as well as the functioning of the government. It is also a fact that several of the government’s schemes need to be benchmarked against international best practices and hence, the windows need to be kept open. While being informed about the complexities of local situations is a must, the theory that only home-grown economists can do the job and “Indian Americans” cannot is a questionable assumption.