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04-21-2012, 11:01 AM #1
Coalition politics behind slowdown: Basu
The country's chief economic advisor, Kaushik Basu , on Friday defended his recent statement given in the United States that economic reforms in India have slowed down and would remain so till the next general elections in 2014 even as it kicked up a political storm .
Basu insisted that whatever he said was his personal opinion and was not a reflection of government's thinking.
Despite being an economic advisor to the government, he waded into political waters, saying that the current slowdown was due to the compulsions of coalition politics. He also took a swipe at the Opposition, saying it has been consistently derailing positive reforms.
"As the chief economic adviser, I have often expressed opinions which are not necessarily that of the ministry of finance or of the government of India. This is one of the strengths of India that it allows us to generate and discuss new ideas without the government having to first endorse them," Basu said in his clarification.
"...thanks to coalitional democracy, there is some slowdown in economic reforms and decision-making. I specifically mentioned that the problem with the GST reform was that the opposition realised this is a good reform. Therefore, it was reluctant to let it happen under the current regime. A single-party majority government would not face this problem. If there is a single-party majority in the next election, that will facilitate such reforms. I argued that some reforms, such as FDI in multi-brand retail, were likely to happen sooner because in principle they did not need the support of the opposition; and this will give a boost to the mood of the economy," he said.
Earlier, addressing a meeting at the Carnegie Endowment for International Peace, an eminent Washington-based think tank, Basu had said that relatively less important bills might go through Parliament. He had said that post-2014 "you would see a rush of important reforms" and after 2015 India would be one of the "fastest growing" economies of the world.