MUMBAI: Finance Minister Arun Jaitley and Reserve Bank of India Governor Raghuram Rajan, in their own ways, on Friday stressed on the need for the country to build more think tanks to help the economy grow.
They were speaking to PhD and MPhil graduates of the RBI-promoted Indira Gandhi Institute of Development Research (IGIDR) during the convocation ceremony.
“India deserves to have think tanks in hundreds in almost every sphere of activity. Today I have started realising that importance, and we need to encourage scholarships,’’ said Jaitley.
“A tax rebate for investors in such think tanks would be a good way to encourage them,” he added.
The country is evolving and the focus down to the village level is on governance and development. India needs more think tanks that can be free of the burden of what’s going on outside, analyze and give suggestions and advice.
Raghuram Rajan, citing a study by chief economic advisor, Arvind Subramaniam, said it’s the good solid institutions that are the key to sustain economic growth, and not resources and people. Slow pace of good quality institutions is a reason for the economy to have slowed, he added.
An emerging consensus from ‘Gyan Sangam’ conclave at Pune is that of new institutions to govern banks. Statement by the government that banks would be free from interference is a landmark statement, which essentially seeks to protect strong commercial decision making by the banks from political interference, the RBI Governor said.
“India needs to continue creating strong institutions that can manage the economic growth that it is creating,’’ said Rajan. “We need independent institutions with public credibility and confidence that these institutions will deliver on their mandate.”
Institution building and preservation is hard as there will be people who will resist institution building. He cited the instance of Dr Varghese Kurien, T N Seshan and Vinod Rai, who strengthened institutions in their own way.
“You may disagree with the details or their processes but you cannot dispute the fact that they left us with stronger institutions that help strengthen the pillars of our democracy as well as our economy,’’ Rajan said.
Jaitley Holds Talks With LIC Management
Finance Minister Arun Jaitley on Friday met the top management of the nation's largest financial institution Life Insurance Corporation of India at its headquarters. Jaitley said that the corporation was virtually a monolith. After partnering with the Jan Dhan Yojana, a third of the country would soon be insured by LIC, a statement from LIC quoted Jaitley as saying.