Bikash Choudhury
Raghuram Rajan is the only global economist who could teach the complex formulations of Macro-Economic policy to a crowd; and, you will see people nodding their heads in confirmation in grasping the issues under deliberations. If you were at the venue of Harekrushna Mahatab Memorial Lecture at Bhubaneswar last month then you could have witnessed the phenomena; you would also have noticed how the auditorium was choke a block full, people standing craning their neck and people spilling over to the lobby with a desire to listen whatever they can from Dr. Rajan. You would have been surprised or becoming simply jealous to see the tall-dark and handsome guy getting all the ladies attention at the event; he was no less than a ‘Bollywood Diva’ or a “Rock Star’ of western make. However, it was not his good looks that was being feted that evening; rather, his razor sharp mind, intimate understanding about the macro economy & monetary policy, his intellectual honesty and of course ample amount of guts to say things in public that most central bankers avoid touching. The summary of his memorial lecture was centered on the wisdom of pursuing good macro economic policy that would be sustainable in long run against the perils of following an aggressive monetary policy that could bring the entire financial system to grief if the gamble did not pay off as most often that it does. He said “Helicopter Money” may not bring consumption growth as in uncertain times people would rather save the windfall gains than spending or investing. He was of the opinion that the innovation should be directed towards the problems of society to be able to add to the GDP. He was against the Oligopolies who buy out small innovative companies which fails to transfer real growth to the economy and fails to create enough jobs for the society. He also drew attention to the aging factor in developed economies that has impacted their growth numbers. This would remain a memorable public lecture at Bhubaneswar for long time to come.
The contribution of Dr.Raghuram Rajan towards our monetary policy has been well documented to be repeated once again. However, his leadership abilities and his grasp over socio-economic-politics and his unorthodox approach to work and his capacity for free thinking and his extraordinary abilities of communicating with stake holders needs to be probed and written about to disseminate why he managed to earn admiration and adulation from a large cross section of people. He has a sixth sense in identifying problem and the courage of conviction to prescribe the most appropriate dose of medicine in terms of policy and remain rock solid pursuing his policies against all provocation; while, remaining calm and composed and at the same time making right noises for the stake holders to comprehend what he intends to do; whether they agree or disagree. In his initial days at the mint street he first enhanced the interest rates against popular expectations and tapered it off much later while controlling the inflationary pressures. He also dealt with the ultra volatility in our currency without employing traditional methods which emphasizes his grasp over global finance and various tools and techniques of Macro-Economic Engineering; therefore, non of his predecessors were as successful as he was in dealing with the currency market. He was very audacious in saying that the “Make in India” the export lead growth model may not be appropriate for India as the export market of western countries and North America has dried up because of domestic factors. This was later confirmed by our own slump in exports and recent Goldman Sach report that emphasizes on “Rural and Farming Sector” for Indian growth story. It was he who stumbled upon excesses committed by the US Financial System and its imminent dangers that hit Americawith sub prime crisis in 2008. Raghu Ram Rajan would be greatly missed in India not only for his economic & financial acumen alone; but for his immense potential to contribute to the society and politics, apart from his impeccable leadership qualities that millions of country men choose to follow voluntarily.
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