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Pulin B Nayak

A Refreshingly New Perspective

Economics: A Primer for India by G Omkarnath (Hyderabad: Orient Blackswan), 2012; pp xix +271, Rs 325.

From Biography to Political Economy

India: A Portrait by Patrick French (New Delhi: Penguin Books), 2011; pp xii+436, Rs 699.

Indian Economy in 2011: Dualism in Policy Formulation

Our policymakers face a dilemma: should we have adequate food and nutrition for all or should we have world-class airport terminals? In an ideal world, one could possibly have them both. But if there are limited resources and there is a question of setting priorities, then surely it should be possible to hold the view that the former should get precedence. Well-trained neoclassical economists can often employ much abstract modelling to prove the opposite.

Anatomy of the Financial Crisis: Between Keynes and Schumpeter

It is instructive to see how the issue of business cycles was looked upon by John Maynard Keynes and Joseph Schumpeter, each of whom wrote masterly tracts on the subject in the 1930s. Though Keynes was concerned with a short-run problem, Schumpeter was concerned with the long-run dynamics of the capitalist system. Given the present financial crisis, it is possible to argue that the true rationale of a stimulus package in countries such as India that are still low in terms of their average level of living ought to be to address fundamental, long-term, rather than short-term, issues.

In Praise of Economic Reforms

In Praise of Economic Reforms Pulin B Nayak This book is about the reform process in the Indian economy initiated in 1991. This is a competent account and the reader stands to learn much from a close reading of the book. The sequence of events leading up to the start, and even the inevitability, of the reform process is well adumbrated. This is however not to say that one need straightaway agree with every nuance of the analysis that the authors have to offer. Though there are many who may claim to be the intellectual progenitors of the reform process it would perhaps not be incorrect to say that the two principals amongst them are the then finance minister Manmohan Singh and his political mentor and the then prime minister Narasimha Rao. There is no denying that the Indian economy at the beginning of 1991 was in the midst of a deep fiscal crisis as well as a payments crisis in the external sector. The fiscal crisis was the result of decade-long spell of extravagance in government expenditure, both at the central and state levels, running substantially ahead of available resources. The foreign trade sector was beset with poor showing on the export front coupled with rising foreign exchange outgo owing principally to sharp increases in oil prices.

Deft Draughtsmanship sans Broader Vision

By not paying attention to the wish lists of business and industry groups, P Chidambaram has done the right thing. The measures related to tax reform in Budget 2007 are the correct ones, but fiscal consolidation is being achieved by compression of capital expenditure. The recent tragedies of Nandigram and Dantewada are symptoms of a developmental process that has gone horribly wrong and there is a need for a new vision of development. Time, however, is running out.

Development and Human Rights

Human Rights The Right to Development: Reflections on the First Four Reports of the Independent Expert on the Right to Development edited by Franciscans International, Geneva, January 2003.

The State and the Market

Pulin B Nayak The real issue is not whether to have the market or the state. This is an empty dichotomy and no serious school of political economy would today credibly argue for only one or the other. The question is one of striking the right balance. What one has also to guard against is a new mode of thinking that the market may be entrusted to sort out all the basic problems confronting an economy, even with its manifest incapacity to deal with issues pertaining to income distribution and deprivation.

Sharpening Inequities

Pulin B Nayak Given the obviously deleterious consequences of last year's economic policy initiatives one might have expected the government to be more circumspect in pushing further the liberalisation drive. But in fact the latest budget presses forward on a number of proposals that were initiated eight months earlier. The hope presumably is that good results will come about as the process of structural reforms works itself through. But this is unlikely to come about in a number of vital areas.

On the Crisis and the Remedies

Pulin B Nayak It is difficult to be enthusiastic about the recent package of economic policy measures which mil be highly inflationary and wilt slowdown investment in economic and social irtfrpstructure. Additionally, it is going to hurt the poor via cuts in schemes like the rural employment generation programme.