Former RBI Governor Raghuram Rajan has said that the belief of Indians in the country's economic future has diminished in recent years owing to the COVID-19 pandemic. He added that the pandemic took a toll on their sentiment and pushed several middle-class citizens into poverty. He was virtually addressing an event organised by the NALSAR University of Law on Friday.
The former RBI chief added that the booming stock market does not reflect the reality that many Indians are in distress. "In recent years we have gotten a little less confident. Our belief in economic future has diminished...the pandemic toll has further diminished our self-belief or 'atma-vishwas' even further while pushing many in the middle-class into poverty," he said.
The central bank had lowered the country's growth projection for the current fiscal to 9.5 per cent from its previous estimate of 10.5 per cent. International Monetary Fund projected a growth of 9.5 per cent in 2021 and 8.5 per cent in the succeeding year.
Rajan said that the thrust of the economic programmes should be to create jobs, instead the states are increasingly reserving employment for locals.
"As our economic performance is diminishing, our democratic credentials, our willingness to debate, to respect and tolerate differences is also taking a hit, not just at the Centre but in many states. You know community sentiment is very easily hurt," he said.
Rajan, currently a professor at the University of Chicago Booth School of Business, noted that any attempt to keep a large part of a country's population down is morally wrong. "Growth that does not take everybody along is unsustainable," the eminent economist observed. He also emphasised that there is a need to protect fundamental rights under all circumstances, saying, "When we suppress debate and criticism, it leads to poor one-size-fits-all uninformed policy choices, with little course correction."
(With inputs from PTI)