Nobel Awardee Abhijit Banerjee Says Indian Economy is Doing Very Badly

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Abhijit Banerjee, right, talks during a news conference with Esther Duflo at Massachusetts Institute of Technology in Cambridge, Mass., on Monday,. — AP

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NEW DELHI — Addressing a press conference in Massachusetts Institute of Technology, New York after winning Nobel Economics Prize, Abhijit Banerjee said on Monday that the Indian economy is “doing very badly” even as the government is increasingly recognising that there is a problem.

Indian-American Abhijit Banerjee won the Nobel prize jointly with his wife Esther Duflo and Harvard’s Michael Kremer in Economics.

Speaking on the state of Indian economy, Abhjit Banerjee said “The economy is doing very badly in my view.”

When asked about his opinion on the state of the economy in India and its future, he said, “That’s a statement not about what will work in the future but about what’s going on now. That I’m entitled to have an opinion about,” reports PTI.

Referring to the numbers put out by the National Sample Survey, that come out every 1.5 years and give estimates about the average consumption in urban and rural areas in India, Mr Banerjee said, “the fact that we see in that is that between 2014-15 and 2017-18, that number has slightly gone down. And that’s the first time such a thing has happened in many many many many many years so that’s a very glaring warning sign.”

“There is enormous fight going on in India about which data is right and the government has a particular view of (that) all data that is inconvenient to it is wrong. But nonetheless, I think that this is something that I think even the government is increasingly recognising that there is a problem. So the economy slowing very very fast. How fast we don’t know, there is this dispute about data but I think fast,” he said.

Banerjee said that in his view when the economy is going into a “tailspin”, is the time when “you don’t worry so much about monetary stability and you worry a little bit more about demand. I think demand is a huge problem right now in economy.”

Last week, Finance Minister Nirmala Sitharaman in Mumbai evaded a direct reply to a question on whether the government accepts there is an economic slowdown, and said the government is giving relief to all sectors who need help.

Mr Banerjee, Duflo and Harvard professor Kremer jointly won the 2019 Nobel Economics Prize “for their experimental approach to alleviating global poverty”.

Mr Banerjee, 58, had also criticised the demonetization by Modi government saying that the pain would be much greater than was initially anticipated. Many feel the current economic stress has its roots in demonetisation.

He was also one of the advisors to Congress on its ambitious NYAY scheme, proposed ahead of 2019 general elections.

Congratulating Banerjee, Congress leader Rahul Gandhi said he had helped the party conceptualise its “Nyay” scheme to help remonetise the economy.

Prime Minister Narendra Modi, Congress President Sonia Gandhi, Former prime minister Manmohan Singh are among the prominent Indian leaders who congratulated Mr Banerjee for getting Nobel prize in Economic Sciences for his valuable contributions.

Banerjee’s pioneering innovations in development economics were applicable and useful to policy making in developing countries such as India, said Manmohan Singh while congratulating him.

(With inputs from PTI)

 

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