Co-hosts Arvind Panagariya and Pravin Krishna discuss causes of pre-Coronavirus growth slowdown, what Coronavirus may bring by way of economic impact and possible responses. On pre-Corona slowdown, they identify four possible explanations: GST, demonetization, weak demand, and financial market disruption. They conclude that financial market disruption is the most important factor accounting for pre-Corona slowdown in growth. Their main recommendation is resistance on the part of the RBI to a return to the past practice of allowing restructured loans to be classified as standard assets. On Coronavirus-induced slowdown, at this stage, there is far too much uncertainty to predict how deep the impact will be. But even under a scenario in which India succeeds in containing the virus to clusters, the impact will be significant. They suggest cash transfers and increased provision of subsidized grain to the poor, especially those in urban areas. The government may also consider temporarily delaying tax collection and loan repayment.
Episode 9: Budget 2020-21: A Scorecard
Professors Arvind Panagariya and Pravin Krishna dissect the positives and negatives in the first budget of the new decade. Among the positive features, they note the government's continued commitment to fiscal consolidation, launch of the reform to simplify the personal income tax system and end the exemption raj, a large disinvestment program including privatization of many public sector enterprises, and the development of five key ancient archeological sites. On the negative side, they discuss the likely damage to the economy from extensive roll back of trade liberalization. They argue that while continued reforms in the domestic arena will allow India to return to 7 to 8% growth in two years' time, the turn to import substitution and protection will deny it double-digit growth.
Episode 8: Budget Suggestions for Modi 2.0
Co-hosts Arvind Panagariya and Pravin Krishna offer suggestions for the first budget of the 2020s. In the first half of the episode, they discuss the core budget consisting of expenditures and revenues. In the second half, they offer suggestions for reforms. On the former, they suggest maintaining fiscal discipline while shifting expenditures towards defense and infrastructure. On the revenue side, they suggest cuts in personal income tax rates along the lines of corporate tax reform, removal of exemptions and aggressive programs of privatization and asset monetization. They urge the Finance Minister to pay special attention to exports and creation of good jobs for those with limited or no skills. They specifically pitch for focused attention to labor intensive sectors such as apparel, footwear and other light manufactures.
Episode 7: Economic Policies Since Independence: A Conversation with Naushad Forbes
This episode brings co-hosts Arvind Panagariya and Pravin Krishna in a fascinating conversation with Naushad Forbes. Forbes is Co-Chairman of Forbes Marshall, a leading multinational engineering company headquartered in Pune. He is also a former President of the Confederation of Indian Industry (CII). The conversation revolves around the evolution of the policy regime around manufacturing in India since independence with special reference to the contrast between pre- and post-reform eras. It offers the listener an unusual window into the pains and pleasures of running a successful corporation, as experienced by Naushad Forbes. Forbes Marshall made its way through the thicket of the license-permit raj during Indira Gandhi years to the era of fierce competition unleashed by the 1990s reforms of Dr. Manmohan Singh. The episode concludes with suggestions for the future direction of economic policy.
Episode 6: FDI Lessons from China for India
In this episode, Co-host Pravin Krishna is joined by Rebecca McGilveray in a conversation with Mary Lovely, Professor of Economics at Syracuse University, on lessons for India from China on Foreign Direct Investment. The episode is recorded on the sidelines of the Columbia Summit on Indian Economy, where Professor Lovely presented her ongoing research on the highly successful experience of China on FDI. She highlights the phenomenal contribution that FDI made to manufacturing exports, raising productivity growth of domestic firms and job creation. She goes on to explain the importance of complementary policies such as those relating to labor and land markets to attract foreign investment. Professor Lovely says that going forward India has a huge opportunity to attract more FDI.
Episode 5: Dissecting Corporate Tax Cut
In this episode, co-hosts Arvind Panagariya and Pravin Krishna discuss the the key reform by India's Finance Minister to boost growth: the unprecedented cut in the tax on corporate profits. They explain what the reform means in the short run and long run. They explain why the tax cut will boost investment and how the government should fill the gap in revenues created by the tax cut. In particular, they suggest speedy privatization of PSUs, monetization of infrastructure assets and sales of unused government land as solutions that would improve productivity while bringing revenues. They also argue that the end to exemptions raj would cut tax disputes and harassment.
Episode 4: Addressing India's Growth Slowdown
In this episode, co-hosts Arvind Panagariya and Pravin Krishna are joined by Sajjid Chinoy, Chief India Economist of JP Morgan. The podcast discusses the current growth slowdown in the Indian economy in the context of the recently released GDP numbers for the first quarter of fiscal year 2019-20. It also explores what should be done in the short run to revive growth and in the long run to sustain it.
Episode 3: Why India Needs a Weaker Rupee
In this episode, co-hosts Arvind Panagariya and Pravin Krishna explain why India must abandon the current policy of a strong rupee. Easing up on the strong rupee will make exports more competitive in foreign markets. It will also make domestically supplied goods more competitive against imports in the Indian market. Furthermore, a weaker rupee will make it easier for India to lower tariffs, thereby helping it shed its image as a protectionist nation and reduce trade tensions with the United States.
Episode 2: Export Led Growth
Professors Arvind Panagariya and Pravin Krishna argue that India can sustain 9 to 10% growth for two to three decades and create good jobs for its vast workforce through an export-centered strategy. They note that no country has achieved these objectives without competing in global markets. Such competition forces efficiency and stimulate innovation in product, process and management practices. The professors also expose the myths that opening to imports causes unemployment and that automation has closed the window to manufacturing-led growth as a viable strategy. They conclude by warning against a return to import substitution, especially in view of India’s own dismal experience with it during the 1960s and 1970s.
Episode 1: The First 100 Days
In this inaugural episode, we focus on what should be the immediate priorities for the first 100 days of the Modi government.
Credits:
Co-Hosts: Arvind Panagariya, Director of the Raj Center on Indian Economic Policies and Professor of Economics at Columbia University & Pravin Krishna, Professor of International Economics and Business at the Johns Hopkins University
Producer: Atisha Kumar, Research Scholar, Raj Center on Indian Economic Policies, Columbia University
Editor: Rebecca McGilveray, INCITE, Columbia University