Growth cannot be chased at the cost of equity: C Rangarajan

OneWorld South Asia, May 02, 2013

At the book launch of ‘Growth and Equity’, which has experts like Kamal Nath, Nitin Desai and Jagdish Bhagwati contributing essays, the talk turned to the policy issues India faces and how consumers in India have now become more aware and are fighting for their rights

“Growth is extremely important because that is the basis on which infrastructure is build, but we cannot forget equity. If we forget equity, social tensions will surface,” said C Rangarajan, chief economic adviser to India’s Prime Minister, Dr Manmohan Singh.

Rangarajan was speaking at the launch of Growth and Equity. The book is a collection of essays written in the honour of Pradeep S Mehta, Secretary General of the Jaipur-based Consumer Unity & Trust Society (CUTS International). The book includes essays and commentaries by Jagdish Bhagwati, Nitin Desai, Frederic Jenny, Vijay Kelkar, Pascal Lamy, Arun Maira, Arvind Mayaram, Shiv Shankar Menon, Kamal Nath, C Rangarajan, Rubens Ricupero, Martin Wolf and others.

India’s Parliamentary Affairs Minister, Kamal Nath, said a multifaceted approach is required for the various Indian states as economic requirements of the states differ from each other. Keeping in with this difference between states, Arvind Mayaram, Secretary, Department of Economic Affairs, Government of India, said that the extreme disparities in a huge country like India make the job of policy-making extremely difficult.

Mehta has been an outspoken activist on the issue of consumer rights and he went on to say how the Indian consumer is now much more empowered through laws and hence has become more vocal than ever before. According to him the overall economic progress in the country has helped consumers to raise their standard of living.

Mehta asserted that measures of equity like the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and Right to Education (RTE) Act, have also helped people raise their standard of living and contributed to overall upliftment of consumers.

Subir Gokarn, Director-Research, Brookings Institution, India, said that there should not be too much worry about the regulatory independence as it can be regularly scrutinised by institutions like media and the civil society.

Though Mehta, on his part, had a different take on this. According to him regulators instead of being under the control of the line ministry, should report to some other ministry. “The bigger problem is that most of our regulators report to a line ministry and therefore they are not independent. Regulators should be removed from the control of their line ministry. Alternate structure should be created to place the regulators directly under the control of Parliament through the standing committees,” he said.

Mehta stressed that there is no conflict between growth and equity. “The government should pursue the growth agenda and increase the size of the cake and then ensure that equity is fostered,” he said. Agreeing with this, Dr Jean-Pierre Lehmann, former Professor, International Political Economy, IMD, praised the intellectual leadership of the country but warned that even as India pursues high growth figures, it should make serious efforts for the equitable distribution of the generated wealth, a crucial factor for sustainable development.

The launch saw people from the government, media and civil society organisations who avidly participated by sharing their views on issues related to consumer rights.

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