In a bid to revive the State’s economy, post-pandemic, and turnaround its precarious fiscal position, the Tamil Nadu government has set up an Economic Advisory Council to the Chief Minister, comprising ‘who is who’ in the fields of macro and developmental economics.
The council comprises former RBI Governor Raghuram Rajan; Nobel Laureate and Professor of Poverty Alleviation and Development Economics at the Massachusetts Institute of Technology, US, Esther Duflo; former chief economic advisor Arvind Subramanian; development economist and visiting professor at Ranchi University and Honorary Professor at the Delhi School of Economics Jean Drèze; and former finance secretary S Narayanan.
Flexible terms of reference
The council, which will provide guidance on economic and social policy, chart ways to boost economic growth and employment, improve the State’s fiscal health and act as a sounding board for new ideas, has been given flexible terms of reference. It can decide on the operational modalities, meet in-person or virtually and give recommendations by way of policy briefs, notes or even oral consultations. S Krishnan, Additional Chief Secretary – Finance, Government of Tamil Nadu, will act as the convener of the Council.
This announcement is a clear sign that Chief Minister M K Stalin is open to new ideas to transform the State’s economic and social policies, said a former bureaucrat. By opting for two macro economists and two social economists , a right balance has been set to bring about growth that touches all segments of society, he added.
Another senior bureaucrat added that the decision to keep the terms of reference flexible and not insist only on a formal report is a sensible move as the members of the council have diverse interests and may not agree on a uni-directional course of action. The government, it appears, will listen to the experts who are the best in their chosen field and decide on what and how to implement them.
“Decentralised planning is required. The broad economic, fiscal, trade and monetary policy contours are set by the Union Government. It is for the state to take advantage as per its strengths. The council is more likely to take a medium- to long-term development perspective,” Devendra Kumar Pant, Chief Economist and Head Public Finance, India Ratings, told BusinessLine.
Former Finance Minister P Chidambaram welcomed the setting up of the Council which had world renowned economists. He tweeted saying setting up of the council was a good move.