Rahul Gandhi discuss impact of the pandemic on Indian economy with Ex Governor Raghuram RajanApril 30, 2020
THE CONVERSATION SCRIPT IS AS :
Rahul Gandhi – Hello
Raghuram Rajan – Good morning, how are you?
Rahul Gandhi – I’m good, nice to see you
Raghuram Rajan – Me too
Rahul Gandhi – In the era of Coron virus, there are many questions in the mind of the people, what is happening, what is going to happen, especially with regard to the economy. I thought of an interesting way to answer these questions, to talk to you about it so that I as well as the common people can know what you think about all this.
Raghuram Rajan – Thanks for talking to me and for this dialogue. I believe that at this critical time, as much information as possible can be obtained on such issues and people should also be aware as far as possible.
Rahul Gandhi – One of the big issues that I feel at the moment is how should we consider opening up our economy? What are the parts of the economy that you think are very important to open and in which order they should be opened?
Raghuram Rajan – This is an important question. We are trying to reduce the graph of infection and do not put excessive burden on hospitals / medical facilities, but at the same time we also have to think how to resume people’s livelihood. Lockdown is always very easy to maintain, but it cannot run for the economy.
It has to be done sequentially. First the place where you can maintain social distancing. Distancing is not only important at workplace but also in the movement of the workplace. Do people have private means of transport, bicycle, scooter or car? Or are they dependent on public transport? How do you create distance in public transport?
It will take a lot of work and hard work to make all this arrangement. Also, it has to be ensured that the workplaces are relatively safe. Along with this, it has to be ensured that if there are any recent accidental incidents, how fast we can isolate the affected people, without implementing the third or fourth lowdown, it would be disastrous.
Rahul Gandhi – This is what many people are saying that if you go to the lockdown again and again, if you open the lockdown and you have to put the lockdown back, it will have a very devastating effect on the economic activity because it will completely destroy the trust. Will be done. Do you agree with this?
Raghuram Rajan – Yes, I think it is right to think. Applying the second lockdown means that you were not successful in starting the activity (financially) properly. From this, the question arises that if you open this time, do you not need a third lockdown and this will bring credibility.
you are right. I do not believe that we should run towards 100 percent success, ie there should be no case anywhere. This cannot be done right now. We only have to manage to start the activity again, that is, if there are any cases, then we isolate them.
Rahul Gandhi – But in this entire arrangement it will be very important to know where there is more infection, and testing is the only way for this. At the moment there is a feeling in India that our testing capacity is limited. As a large country, our testing capacity is limited compared to the US and European countries. How do you see a small number of tests taking place?
Raghuram Rajan – Good question, take the example of an American. There are up to one and a half lakh tests in a day. But there is a unanimous opinion of experts, especially epidemiologists, that to start opening the activity, triple the number of these tests should be done ie at least 5 lakh tests everyday and some people are talking about several million tests. .
Given India’s population, we should test it four and a half times. If you want as much confidence as America, then we have to do 20 lakh tests everyday. It is clear that we are not even close to them, because we are only able to do 25,000 to 30,000 tests daily.
But we have to be prudent in terms of starting activity. Perhaps we have to test the general public at a broader level. For example, take 1000 samples of the general public and check extensively, if you find any signs of the virus in them, go deep into the sample and see where it came from. In this way our testing structure will reduce the load and in some cases we will be able to do much better work despite less intensive testing. We will have to work more wisely because we cannot wait until we can achieve testing capabilities like America.
First the impact of the virus is going to be deep and then its effect on the economy will be deep. After a few months, the economy is going to get hit. How do you strike a balance between fighting the virus and the devastating effects of the virus after 3-4 months?
Raghuram Rajan – I believe we have to set priorities. Our capabilities and resources are limited. Our financial resources are more limited than in Western countries. We have to decide how we can handle both the fight against the virus and the economy simultaneously. When we open the economy, it should be such that you can get up from the disease and not stand in front of death.
The first thing is to keep people healthy and alive. Food is very important for this. There are places where the public distribution system has not reached, Amartya Sen, Abhijeet Banerjee and I talked about the temporary ration card on this subject. But you have to face this epidemic like an unexpected crisis.
We have to think out of the box based on the needs. Decisions have to be made keeping in mind all budgetary limitations. We have limited resources.
Rahul Gandhi – What do you think about the agricultural sector and the workers? What do migrant laborers think about. What should be done about their financial status?
Raghuram Rajan – In this case it is time to take advantage of our efforts in Direct Benefit Transfer. We should be aware of all the arrangements by which we reach money to the relatively poor. We have many methods available like widow pension and MNREGA. We should say that look, these are people who do not have employment, who do not have means to livelihood and we will help them for the next three-four months as long as this crisis is there.
But it would be beneficial to keep people alive and prevent them from being forced to go out in the midst of a lockdown to protest or in search of work and that should be our priority. We will have to find ways through which we can reach more and more people and also provide them food through PDS.
Rahul Gandhi – Dr. Rajan How much will it cost to help the poor, to give relief to the poor?
Raghuram Rajan – About 65,000 crores. Our GDP is 200 lakh crores, removing 65,000 crores out of it is not a huge amount. We can do this. If it is for the poor, we should do it to save their lives.
Rahul Gandhi- The country is still in crisis, but after Kovid, will India have any benefit / benefit from this incident? Will there be any strategic advantage? Will there be any changes in the world that will benefit India or whose Hindustan can take advantage? How will the world change according to you?
Raghuram Rajan- Generally, these kinds of situations rarely bring good conditions for a country. Nevertheless, there are some ways in which countries can benefit. I believe that after coming out of this crisis, every aspect of the global economy will need to be thought in a completely new way. If there is any chance for India, this is how we turn the dialogue. In this dialogue, we should think like a leader because it is not a matter between two opposing parties. But India is such a big country that our words should be heard well in the global economy. In such a situation, India can explore opportunities for its industries and supply chains. But the most important thing is that we turn the dialogue in a direction that has a place in the global system for more countries, a multi-polar global system rather than a polar or bipolar global system.
Rahul Gandhi – Don’t you think there is a crisis of centralization. The power has become so centralized that the negotiations have almost stopped. Conversations and dialogues solve a lot of problems that you have mentioned, but for some reasons this dialogue is being broken.
Raghuram Rajan – I believe that decentralization is important not only for exposing local information but also for empowering people. At this time, disarmament in the whole world is that decisions are not being made by me from anywhere else. I have one vote to choose someone remote. My panchayat and the state government do not have the strength. There is a feeling among people that their voice is not heard in any case. In such a situation, they become victims of different powers.
I will ask you the same question. The impact of the Panchayati Raj which Rajiv Gandhi brought once again, how much effect it had and how beneficial it proved to be.
Rahul Gandhi – It had a tremendous impact, but sadly, it has to be said that it is decreasing now. We are returning from the progress that was made on the Panchayati Raj front, and we are going to the District Magistrate and Officer based system. If you look at the South Indian states, good work is being done on this front, decentralization of the systems is taking place. But centralization of power is taking place in North Indian states and the powers of panchayats and land-related organizations are diminishing.
Raghuram Rajan – The more the decisions are taken by joining people, the more able they will be to monitor the decisions. I believe this is an experiment that should be done.
Rahul Gandhi – But why is this happening globally? What do you think is the reason that centralization is happening on such a large scale and the dialogue is ending? Do you think there is something at the center or there are many reasons behind it?
Raghuram Rajan – I believe that there is a reason behind this and that is the global market. It has become a belief that with the globalization of markets, the firms participating in it also want to implement the same rules everywhere, they want the same kind of coordination system everywhere, they want the same kind of government, Because it boosts their confidence. The attempt to bring about uniformity has taken away the powers and powers of local and national governments. Apart from this, there is a longing for centralization in the bureaucracy, if I can get power then why should I not get it. This is a constant longing. If you are giving money to the states, then you have to follow these rules, not without any question, you get money, while I know that you have also come by election and you should be aware that for you What is right.
Rahul Gandhi- These days a new model has come, that is the authoritarian or totalitarian model, which is questioning the liberal model. This is a completely different way of working and it is flourishing in more places. Do you think it will end?
Raghuram Rajan – I do not know. Authoritarian model, a strong personality, a world in which you are powerless, sometimes it appeals, especially if you have a connection with that personality, when you think they believe me, they care about people. is. The problem with this is that the totalitarian personality creates a belief in itself that ‘I am the manpower’, so whatever I say will be true. My own rules will apply and there will be no investigation, no institutions, no decentralized system. Everything should be according to my knowledge. Looking at the history, it will be known that whenever centralization has taken place to this extent, the systems have collapsed.
Rahul Gandhi – But there is something wrong with the global economic system. It is clear, it is not working. Is it correct to say so?
Raghuram Rajan – I think it is absolutely true that it is not working for many people. The uneven distribution of wealth and income in developed countries is certainly a cause for concern. Uncertainty of jobs, redundancy is another source of concern. If you have a good job today, do not know if you will have a source of income tomorrow. We have seen in the era of this epidemic that many such people have no employment, both their income and security have been lost.
Therefore, it is not just a problem of slowing down the growth rate. We cannot live without markets, we need development. We are also distressed by the inadequate distribution problem. Not everyone is getting the full fruits of whatever development has happened, many people have missed it. So we have to think about both aspects. That is why I think we have to think about the distribution system as well as the distribution of opportunities.