This must is go the after reason corruption, why I have we have been to stressing make sure that that while it does we not from descend being effective. to a witch-hunt. The pursuit That of will the prevent corrupt good needs people both determination Q. How severely and intelligent is India’s design. investment climate being affected due to this?
A. The impact on the investment climate is there but it’s a short-term phenomenon. Our annual level of investment and savings, at well over 30 per cent of GDP, is a matter of envy. Moreover, foreign direct investment has resumed coming into India and there is a distinct possibility that this year will see a record FDI inflow. The drop in investment that we have seen over the past few months and will probably see for a few more is caused by the general global gloom and the tightening of domestic demand that we had to go through to bring inflation down.
Q. Supply side constraints are something that successive governments have not bothered about. Bumper crops every other year have made us complacent...
A. There will be a bumper crop every few years, by definition. This is why I never speak of a record harvest. Turning to the more substantial part of your question, it is important to boost agricultural productivity and to try and reach our very reasonable target of 4 per cent per annum.
Q. Imported inflation is equally irksome. Are we on the precipice of sub-8 per cent growth again?
A. We may be on this or that side of 8 per cent but I wouldn’t call it a precipice. There’s no risk of falling off. Q. What do you tell Pranabda on economic policy? A. First of all, I’d love to call him da but I don’t—he is the finance minister, don’t forget. I talk to him on economic policy—from macro demand management to microeconomic policies for making markets more efficient. And I don’t always tell him what he wants to hear. One remarkable thing about India and certainly the Ministry of Finance is that we have the space to make suggestions which may or may not be in keeping with official theology.
Q. Are the Government and RBI on the same page as far as tackling inflation is concerned?
A. On the same page, yes, though they may not be on the same paragraph. What I mean is that on overall objectives, we are in agreement. But do we take the same view on every policy? Of course not! If we did, you could do away with one of us—the Government or the RBI. This openness is India’s strength and this is why I believe that no matter what our short-term problems, India is on a long-term high. India is among the fastest-growing nations and, given our democratic polity, there is reason to expect that it will remain so for two or three decades. effectively with the outbreak of Japanese encephalitis in eastern Uttar Pradesh, an epidemic that had already claimed 450 lives. The Department of Information Technology has been without a full-time secretary for over a year. Telecom Secretary Rentala Chandrasekhar, already overworked with defusing the fallout of the 2G scam, has been holding additional charge. In July, the Appointments Committee of the Cabinet handed additional charge of Youth Affairs to Sports Secretary Sindhushree Khullar for three months. She continues to hold the charge.
Two of the most crucial institutions under Kapil Sibal’s Ministry of Human Resource Development have been headless for more than eight months. The University Grants Commission is functioning with an officiating chairman since February 6, when Sukhadeo Thorat’s term ended. The commission’s Vice-chairman Ved Prakash has been the officiating chairman with the search committee unable to find an appropriate candidate. The National Council for Educational Research and Training ( NCERT) too has gone without a director for eight months.
The industry ministry under Anand Sharma has failed to push ahead with FDI in retail. The national manufacturing policy was announced after a two-year delay in October and contained no radical suggestions. The environment ministry has not overcome its ‘no-go’ mode despite getting a new minister, Jayanthi Natarajan, in July. The urban development ministry, headed by Kamal Nath since January, has refused to take a final decision on the regu-