Taking a sneak peek at new CEA V Anantha Nageswaran's thoughts

The new chief economic advisor, V Anantha Nageswaran, has been writing commentaries on topical economic developments. Thus his views on various issues can be collaged to gauge his economic thoughts. Here are his commentaries on a few key issues:

Demonetisation

"Demonetisation will cost more than slow growth (September 5, 2017, Mint)"

"Judgment on epochal policy decisions cannot be rendered instantaneously or in real-time. Bank nationalisation is an example. At the end of the first two decades, its scorecard was positive, on balance. At the end of five decades, it is mixed to negative. Historians will record that the opposite is true of demonetisation 

(November 9, 2020, Indian Express)"

New GDP methodology

"It is possible that the failure to accept a lower growth rate has actually prolonged the growth stagnation. The government could have easily asked the CEA or the Department of Economic Affairs to come out with such an exercise as soon as the controversy about GDP growth estimates erupted in 2015. That would have made both monetary and fiscal policy more responsive in the last four years 

(June 19, 2019, Mint)"

Bad bank

"It’s better to stop the creation of bad debt than set up a bad bank 

(January 18, 2021, Mint)"

Budget, 2021-22

"This budget will stand India in very good stead for 2021-22 and beyond
(February 1, 2021, Mint)"
 

Cryptocurrency

"Cryptocurrencies are the thin end of the wedge of a power struggle between the elites that currently hold power and other elites wanting in. It will probably not end well for either 

(February 15, 2021, Mint)"

India's solar power capacity

"Almost 75 per cent of India’s solar power capacity is built on Chinese solar cells, and modules. India’s solar cell manufacturing capacity stands at 3Gw and for modules, it is 5Gw, whereas the country’s solar power generation capacity stands at 32Gw 

(April 7, 2021, Mint)"

Lockdowns

"This time around (the second Covid wave), the prime minister exhorted states to use targeted and localised lockdowns that many had advocated at that time (the first Covid wave) as an alternative which he eschewed. But now, he is a target of criticism for not locking down the country and for putting the economy and economic growth ahead of health and lives 

(May 5, 2021, The Gold Standard which was republished in Swarajya)"
 

Corporation tax
 

"...the government could consider a one-time additional tax to be collected in 2021-22 on the profits of 2020-21, just as it brought in an Ordinance to lower taxes in September 2019. Indeed, if capital formation does not pick up and if corporate tax revenue growth is too low relative to the growth in profits in the coming years, it may well become necessary to revisit the country’s top marginal corporate tax rate 

(June 1, 2021, Mint)"

Bringing fuel into GST
 

"Just as India’s goods and services tax itself took more than a decade to implement, the project to bring fuel products under this regime, which would entail much lower rates, could take a decade

(June 29, 2021, Mint)"

Covid deaths
 

"We believe that there is no case for haste in estimating Covid deaths, except to improve the health infrastructure and prepare the country for future eventualities. On that score, India has made considerable progress

(Article written with SBI Group chief economic advisor; July 27, 2021, Indian Express)"

Reviving investments

"...it is not necessarily the case that weak demand conditions would hold back capital expenditure. An investment boom can create a virtuous cycle of supply and demand. If India puts the fear of a third wave behind it, the economy may experience a partial repeat of the 2003-08 boom. Our challenge will be to sustain it without suffering a credit bust 

(August 17, 2021, Mint)"

Global Hunger Index, 2021, which showed India's rank slipped seven positions to 101 among 116 countries

"Given how justifiably proud India has been in avoiding famine-related deaths due to Covid and internal migration, thanks to its Direct Benefits Transfer Mission, including transfer of in-kind government benefits like foodgrain, India has a right to be aggrieved at the score 

(October 19, 2021, Mint)"

MSME credit
 

"Through the electronic filing of returns, the GST regime brought MSMEs into formal channels of compliance. However, they still need to be brought into formal credit channels by integrating the GST architecture with the TReDS and Udyam

(November 1, 2021, Mint)"
 

Should schools be opened?
 

"...nearly two years after the onset of the pandemic, there is no case for school closures and blanket lockdowns. The collateral costs and long-term damage to the mental, intellectual, and physical health of children far exceed any perceived benefit of such measures

(January 18, 2022, Mint)"

Sustained GDP growth
 

"... a steady-state average real GDP growth rate of 6.7 per cent to 7 per cent can be a reasonably conservative assumption for India for the rest of the decade  

(January 25, 2022, Mint)"