“Raghuram Rajan is joining the Reserve Bank of India (RBI) to be the next Governor”, I told my friend, as I casually pointed to Rajan’s book, Fault Lines. Furrowing his eyebrows, looking quite puzzled, he asked me why that MTV Roadies guy is joining the RBI! Humorous? This is because each day as we get our morning newspaper, we shove away the main sheets and read up all the gossip on Page 3, to see where last night’s biggest party has been at, and which celebrity recently got a manicure. If he would have simply glanced at the inner pages, which have been littered with news about the change of guard at the RBI, he would know that the Chicago economist does not share that much in common, except his first name, with the immensely talented MTV host.
To say that the Indian economy is not in a crisis situation is excessively optimistic. We are exactly at that stage wherein most economists like to use the catch phrase ‘at the brink of a crisis’. I am actually beginning to think that if there ever was a blame-game competition, we Indians would emerge the undisputed winners. Ask anyone – ranging from an auto-rickshaw driver to an educated working professional – to state a reason for the current situation and you’ll get an answer, and a pretty convincing one as well. The common man and the media would blame the government, the government would blame the opposition and the external situation, the external sector blames the Indian political setup and the ruling party, and the patriotic Indian would say the Rupee was falling so drastically because we’re drinking more Coca-Cola and lesser Nimbu Paani! Um… No. Continue reading