BeyondHeadlines Staff Reporter
New Delhi: Home Minister P Chidambaram yesterday said that improving governance remains the greatest challenge for the government. However, he sought to dispel perceived notion of policy paralysis, stating that the government continues to put economic growth, change and reforms at the centre of all issues.
“The current problem (faced by the country) does relate to governance. But it would not be correct to generalize. We have examples of good governance, the issue is how to make it universal,” said Chidambaram at a function at FICCI to discuss a paper on 20 years of reforms by Swaminathan S Anklesaria Aiyar, the consulting editor of The Economic Times.
Other panelists Jaswant Singh, C Rangarajan and Abhijit Sen, member, Planning Commission, also said governance requires greater attention. Chidambaram further said that 20 years after liberalization, there are two issues on which greater progress should have been made namely, increasing the pace of reduction in poverty and increasing access to education.
Chidambaram added the current blips like declining investment rate, high inflation can be tackled with a good mix of policies and that sustaining high level of growth in India over the next 10-15 years is possible.
A panel of other policymakers at the function to discuss the paper “The Elephant that became a tiger -20 years of economic reforms in India” , agreed and reiterated Chidambaram’s take that the foundation of current high growth economy was laid by the liberalization in 1991.
Aiyar stated that the reforms in 1991 had helped India’s image morph from a lumbering elephant to a tiger and be looked upon as a “miracle economy” and a “superpower”. “The perceived notion of India as a bottomless pit for foreign aid to a political and economic superpower is staggering,” Aiyar said.
He added that having an ‘brain-intensive’ export market, entrepreneurial innovations which had made India a leader of “frugal engineering” along with conventional macroeconomic parameters like healthy savings rate, per capita income point to a sustained robust growth rate in future. However, Aiyar also pointed out that the government has a huge unfinished agenda of improving governance and quality of public goods being delivered by the government. “As far as governance is concerned, we are still waiting for a miracle,” Aiyar added.
Former Finance and External Affairs Minister Jaswant Singh said that tackling high prices and reforms in agriculture need more attention. C Rangarajan, chairman prime minister’s economic advisory council, also stated that the three issues facing the government in the short run are taming high prices, bringing the current account deficit in the balance of payments to 2.5% of GDP and continue fiscal consolidation to meet FRBM targets.