Former RBI Governor Raghuram Rajan has said that the government needs to focus on underlying economic issues like that of creating jobs, while making a strong case against reservations saying that such short-term political solutions damage the fabric of the country.
Former Reserve Bank of India (RBI) Governor Raghuram Rajan has said that the government needs to focus on underlying economic issues like that of creating jobs, while making a strong case against reservations saying that such short-term political solutions damage the fabric of the country.
“There are underlying issues, for example, an issue of jobs. Pretty strong communities in India have started protesting for a reservation because ultimately it comes down to finding jobs. It’s very important to tackle the underlying economic problems that of creating jobs,” Raghuram Rajan said in a recorded interview played at the Times Lit Fest 2017.
He said that only broad-based economic growth can solve the problems of the country. “We need to focus on that as the ultimate solution rather than emphasise grievances… (they are) politically in short-term very convenient but have potential to bring apart the fabric of this country,” the former Governor said.
“It (populist nationalism) has a potential to damage. I would define very simply as the majority community feeling aggrieved that it is being discriminated against. It exists across the world. It exists in India also,” he added.
Raghuram Rajan made these comments referring to rising populist nationalism and also agitation by powerful communities, including Patidar community and Jat community, which are feeling discriminated and is seeking reservation in jobs.
He described populist nationalism as “inward looking”, while policies it advocates often come in the way of growth. “Nationalism is not patriotic because it is divisive and can even be quite dangerous. However, it is wrong to dismiss people who are voicing these things..dismissing them as rustic. These protests have a sense of identity that is being eroded…that cry also has to be heard,” Raghuram Rajan said.
The ex-governor of the central bank said in the ultimate analysis, democracy is India’s strength. “There may by push and pulls in the working of democracy, but in the long-term it is beneficial. It is egalitarian, takes people along together, a superior mechanism to identify the flaws in the market system and for the system to react,” he said.
About “illiberal democracy”, Mr Rajan, who is a professor at the University of Chicago, said that it was “a function of the system, which kowtows to the strong leader”.
“Business leaders, apart from some exceptions, tend to bow to the political leader. Illiberal democracy is crony capitalism also because the interests of business and political leaders coincide,” he said.