Chief Economic Adviser Arvind Subramanian, who happens to be one of the front-runners to succeed Raghuram Rajan as the next RBI Governor, has said that India is an under-performer despite the level of its political institutions and it can support a higher growth.
Subramanian made the statement at a book discussion on “India’s Long Roads – The Search For Prosperity” by author Vijay Joshi.
“We are already growing at over 7 per cent. Growth of 8 per cent or more is eminently doable, subject to the international environment being cooperative,” he said.
For the current fiscal, however, he urged a wait-and-watch policy, saying “so far the monsoons are good”.
India grew by 7.6 per cent in 2015-16 with the Finance Ministry hoping for an 8 per cent growth in the current fiscal riding on hopes of a good monsoon.
The Chief Economic Adviser said to bring about radical reforms in a “medium large country like India, which is not facing a crisis” is difficult.
“The fact is that when we are not in a crisis, radical reform becomes difficult. We are hopeful of change. It can come by Central government, dynamism of decentralisation and competitive federalism. That’s going to be the way forward for India. My standard is of persistent, encompassing and incremental reform,” he said.
“However, the expectation of big bang or radical reforms in India is a historically unreasonable standard as the incentives of reforms are shaped in different ways…for a country like India that is not facing a crisis and is unwieldy with power widely dispersed,” he added.