16 June, 2021

‘We Only Postponed The Day Of Reckoning’

In a rare interview, the emeritus professor of economics at the JNU speaks on the state of the economy

Jitender Gupta
‘We Only Postponed The Day Of Reckoning’

Economist-cum-technocrat Deepak Nayyar is viewed as an influential observer of the economy and a selective critic of liberalisation. He was the chief economic advisor to the government during the tumultuous period between 1989 and 1991, when India negotiated with the International Monetary Fund. In a rare interview, Nayyar—emeritus professor of economics at the Jawaharlal Nehru University in Delhi—took questions from Sunit Arora:

Sunit Arora: Professor Nayyar, is India facing a balance of payments crisis?

Professor Deepak Nayyar: We are indeed in a crisis. In the past three months, confidence has been strongly undermined. India’s balance of trade deficit (10 per cent of GDP) and current account deficit (4.8 per cent of GDP) are both at levels that are unsustainable in terms of fundamentals. If you compare this with the past in India, or the present in other emerging economies, you would recognize how serious the situation is. It is as clear as daylight that we cannot...

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