MUMBAI – Why did the early promise of the Indian economy not materialize and what led to its eventual turnaround? In conversation with Dr. Rakesh Mohan, deputy governor of the Reserve Bank of India, Columbia University Professor Arvind Panagariya offered an analysis of India's economy over the last fifty years--from the promising start in the 1950s, to the near debacle of the 1970s, to the phenomenal about face of the last two decades.
At this Asia Society India Centre event held at the Taj President Hotel, Professor Panagariya illuminated the ways that government policies have promoted economic growth, and discussed such key topics as poverty and inequality, tax reform, telecommunications, agriculture and transportation, and the government's role in health, education, and sanitation.
Professor Panagariya said that agricultural reform is needed in the short run in order to raise farmers’ income levels. In the long run, however, agricultural growth would not be able to grow fast enough -- even an increase from its current level of 2.5 percent to 4 or 5 percent would not be sufficient. What is needed is for people in the farming sector to be pulled away into non-farming, labor-intensive industries (such as production of apparel, footwear, consumer goods), where well-paying jobs can be created for many.
Reported by Angeline Thangaperakasam, Asia Society India Centre
Excerpt: On the Role of Agriculture in the Indian Economy and the Need for Market Reforms (5 min. 15 sec.)
Listen to Entire Program (1 hr., 9 min.)