Under Arvind Panagariya, the Niti Aayog piloted a number of reforms ideas in both economic and social spheres, but the sudden departure of its vice-chairman puts under the spotlight the numerous occasions when the difference of opinions between the think-tank and other wings of the government came to the fore. Also, unlike the erstwhile Planning Commission, where deputy chairman Montek Singh Ahluwalia was the final authority after the Prime Minister, in the Niti Aayog, several important initiatives were being almost completely handled by other high-ranking officials of the think-tank, leading to the creation of multiple power centres within the body.
In January, Panagariya had raised the first red flag on the possibility of taxpayers being harassed post-demonetisation and had reportedly written to the Prime Minister’s Office highlighting the need to codify rules to ensure that people, especially women, are not made to suffer for having deposited old notes between November 8 and December 30.Panagariya had suggested that there should be no questions asked on cash deposits up to Rs 2.5 lakh. This would help the taxman and the taxpayer, given the large number of depositors during the last 50 days. The I-T department has been receiving information about cash deposits of over Rs 2 lakh and Rs 5 lakh from banks on a daily basis.
The draft of Niti Aayog’s three-year action plan, which was prepared under Panagariya’s tenure, had also pointed out several concerns in the Centre’s economic policy-making that needed urgent attention. It had flagged numerous concerns including those over rising tax disputes; higher recapitalisation requirement for public banks burdened with non-performing assets; and scope for interpretation in tax laws.
The document, which was released in April this year, also flagged the fundamental issue in the country’s expenditure planning, which had a “strong tendency” towards revenue expenditure at the expense of capital expenditure. It also noted that within revenue expenditure, subsidies had overshadowed expenditure on social sectors such as health and education. The Niti Aayog, under Panagariya, also faced flak from RSS affiliate Swadeshi Jagran Manch, which organised a roundtable on the think-tank’s functioning in January and criticised various recommendations put forth by it including for sectors such as agriculture and health. The body has also criticised Niti Aayog’s support to genetically modified crops.