Krishnamurthy V Subramanian, a high-flying establishment economist, has reacted strongly to an article critical of India’s macroeconomic situation. He was the chief economic advisor in the ministry of finance and is currently India’s representative to the International Monetary Fund (IMF). As an establishment economist, he is obviously touchy about criticism of India’s economic performance. But should he be so strident?
Subramanian’s tweet
He has characterised Indians abroad (NRIs) as either being “patriots” or “selfish and self-serving”. He says the former “want India to do well even if they are not living in India”. The latter “rejoice from spreading negativity on India bcos it justifies their life’s most imp decision”. He posits a false binary of being positive or negative. Actually, being critical may not be self-serving, but patriotic.
Having lived in US for > a decade, I say there r 2 kinds of NRIs: 1. Patriots who want India to do well even if they r not living in India; 2. Selfish, self-serving ones who rejoice from spreading negativity on India bcos it justifies their life’s most imp decision.👇 https://t.co/reEIN1PnIJ
— Prof. Krishnamurthy V Subramanian (@SubramanianKri) June 13, 2024
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Subramanian as a senior official ought to have been circumspect, but his aggression is in keeping with the current environment in the country and wanting to show his loyalty to the King. The establishment has been equating criticism with being anti-national.
I am not on X (formerly Twitter), so I learnt of Subramanian’s tweet from a friend. It reinforced my view of establishment economists as defenders of the faith, no matter what. It brought forth memories from the past of how these worthies have not been critical enough and ‘patriotically’ defended the official stance which has often adversely impacted the nation. Largely, they have worked to stay in power to enjoy the fruits of power.
Being a critic is costly while being pro-establishment gets one various benefits. So, for most, the latter position is preferable while the former requires conviction.
Two-handed economists
Many economists in India have curried favours from those in power. Senior political leaders have mentioned to me that membership of a Committee is enough for many. So, sycophancy has been widespread. This is partly a result of India still being largely a feudal society where complying with diktats from above has been a norm. Some friends in the official circles have advised me to moderate my stand to stay relevant.
It is easy since economists are famous for ‘on the one hand and on the other hand’. A clear stand is not required so that those in power can do what their politics dictates.
In the mid-1980s, many young economists said that if they could get a three-month consultancy in the World Bank (or Asian Development Bank), they could buy their car, and with a one-year consultancy, they could buy a house. A long-term stint would get them a large tax-free pension. A colleague who had rented a big flat said that after the deduction of rent, he got Rs 12 in hand. He lived beyond his means and was dependent on consultancies and business contacts for additional income. These young friends aggressively moulded their opinions to the requirements of the establishment. Young bureaucrats came to us to discuss whether doing a PhD would enable them to get a stint in international agencies like the World Bank.
A revolving door came into being in the mid-1980s. The same set of people worked in the World Bank, etc., and in policy making in India. This facilitated the adoption of the policy framework of the international agencies by Indian policymakers. Was this wrong? Certainly so, if one takes seriously the current regime’s talk of decolonising the Indian mind.
Objectively, the policy framework served the interest of international finance capital and not that of the vast majority of Indians who were poor and coercively involved in the markets. Multi-national capital (MNCs) and Indian big business benefitted at the expense of the marginalised Indians. The result has been growing inequality and a variety of social and political problems in the country. For instance, there is growing alienation, unemployment and loss of faith that in the long run, policies can resolve the problems of the marginalised. So, now around election times, right or wrong, political parties have to offer immediate gains – cash, gas, laptops and so on.
Patriotism?
Is patriotism to be defined by the ruling dispensation? If that is the case it is a ploy to curb dissent and strengthen itself. D.K. Baruah patriotically said during the Emergency, “India is Indira and Indira is India”. People were not impressed and voted out Gandhi. In a democracy, the establishment’s definition of patriotism should not be accepted. What can it be, especially, in the context of what Subramanian has said in his tweet?
Policymakers often go wrong and even horribly so, like, with the demonetisation and sudden lockdown. So, were the architects of such policies unpatriotic? The simplistic binary suggests so.
In life and society, complexities abound leading to a multiplicity of opinions and ideas among analysts and political actors. Many of the ideas may be contradictory but when policymakers take them into account better decisions follow. In spite of the best intentions, policies may lead to long-run problems like those resulting from the ‘trickle down’ development path pursued by India since Independence.
Long run short run mismatch
Policies have long-term implications. Unfortunately, most policymakers are short-termists and indulge in fire-fighting, ignoring the long-term adverse consequences. So, who is to judge whether the policymakers are correct and the critics are wrong or vice versa? Both may be wrong but not unpatriotic. An economy is ever-changing and buffeted by unexpected small or big and local or global events. The big ones like the GST and the pandemic administered a shock to the economy that was not expected by policymakers.
The economy is buffeted by various political forces and policymakers have to take them into account. That is the political economy of the nation. Take the case of the large numbers of farmers who opposed the three farm bills that the government rammed through parliament during the pandemic. Were these bills good as establishment economists argued or were the farmers and the critics correct because they feared damage to farming and the country? The former view was supported by a corporate lobby.
The bills had to be withdrawn due to the sustained protest by the farmers. The government spokespersons characterised the opponents as anti-nationals, Khalistanis and worse. A false binary was created rather than accepting that given the different economic interests in the country, there are bound to be differences of opinion.
Conclusion
Returning to Subramanian’s statement, in as diverse a nation as India, where contrary opinions are bound to exist, why should one expect NRIs to not have diverse opinions about policies and India’s economic situation? When patriotism is undefined nationally can one use it to characterise NRIs? The tweet brings into question Subramanian’s judgment about complex societal matters.
With a coalition government in power, diverse opinions are likely to be taken into account and the use of the earlier binaries to browbeat the opposition will have to be given up for smooth functioning.
Arun Kumar is a retired professor of economics from Jawaharlal Nehru University. He is the author of Indian Economy’s Greatest Crisis: Impact of the Coronavirus and the Road Ahead (2020).
