Raghuram Rajan, former Reserve Bank of India governor from 2013 to 2016, will head Tamil Nadu’s Economic Advisory Council to the Chief Minister. This was revealed in the address of the Governor to the Tamil Nadu Assembly in Chennai on June 21. The customary address lays out the course the government will adhere to during the year.
The other members of the council are Nobel laureate Esther Duflo of the Massachusetts Institute of Technology, United States; development economist Jean Dreze, who puts people at the centre of all development; Arvind Subramanian, former Chief Economic Advisor (CEA) to the Indian government; and S. Narayan, former Union Finance Secretary. Dr Subramanian had resigned as CEA to the Narendra Modi government citing personal reasons.
“Based on the recommendations of this council, the government will revitalise the State’s economy and ensure that the benefits of economic growth reach all segments of society,” Governor Banwarilal Purohit read out.
Earlier, giving out the reason for setting up such a council, he said: “In recent years, we have seen a slowdown in Tamil Nadu’s economic growth rate. The government will make all out efforts to reverse this trend and usher in a period of rapid economic growth taking full advantage of the available limited window of the demographic dividend.” He said the council was being formed to “chart out a rapid and inclusive economic growth path for Tamil Nadu.”
White Paper on Finances
The Governor pointed out that “the fiscal health of the State is a cause for serious concern, and this government will focus on improving the fiscal position and bringing down the overall debt burden. As a first step, a report (white paper) detailing the true state of Tamil Nadu’s finances will be released in the month of July, so that the people of Tamil Nadu are fully informed.”
In a tweet on June 20, Finance Minister P.T.R. Palanivel Thiaga Rajan said before the Dravida Munnetra Kazhagam (DMK) came to power, it was not aware of the full extent of fiscal decay. “Things we didn’t know then: 1) Union Budget would switch ~50,000 Cr from Excise to Cess (not shared w/ States) 2) Scale of COVID 2nd wave & spending required (1000s of Crores) 3) Full extent of Fiscal decay…,” he tweeted.
After the close of the Assembly session for the Governor’s address, the Anna Dravida Munnetra Kazhagam (AIADMK), the main opposition, cited the promise of reduction of fuel prices and asked why the DMK was not reducing petrol and diesel prices. Responding to this criticism, P.T.R. Palanivel Thiaga Rajan said in the same tweet: “We did not promise immediate cut. We will cut during our term.”
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