New Delhi:

Finance Commission Chairman Arvind Panagariya in an affirmation to the idea of ‘One Nation, One Election’ explained that frequent elections do not give enough opportunities to the government to carry out reforms.

NK Singh, the former Chairman of the Finance Commission, also supported ‘One Nation, One Election’ as a key area of economic reforms, citing wasteful expenditure and distractions due to “elections being held every second day”.

Both economists spoke to NDTV Editor-in-Chief Sanjay Pugalia in an exclusive interview.

Mr Panagariya, who served as the first Vice Chairman of the government think tank NITI Aayog from January 2015 to August 2017, told NDTV, “One Nation, One Election constitutes a very, very far reaching important reform, far beyond the political matrix, which has huge implications for economic growth and development.”

“If I may add, on this important issue that Mr Singh has mentioned, One Nation, One Election. When elections happen repeatedly, it also impacts the government’s ability to introduce reforms,” Mr Panagariya said.

“The current situation actually provides a good example. In May 2024 we had the parliamentary elections and since then we have been having one or another election every six months,” he told NDTV.

“That obviously denies the government the ability to bring major reforms because they become the bone of contention during elections,” Mr Panagariya added.

A Joint Parliamentary Committee (JPC) reviewing the One Nation, One Election bill has 27 members from Lok Sabha and 12 from Rajya Sabha.

The Constitution (129th Amendment) Bill was introduced in the winter session of the Lok Sabha. The bill would pave the way for simultaneous elections to the Lok Sabha, state assemblies, and local bodies with minimum gap.

But its implementation will need a series of amendments to the Constitution that can only be done with two-thirds majority in parliament. Some provisions may have to be ratified by governments in states and Union Territories.

The Opposition has voiced objections, with most parties contending that the bill would subvert the Constitution – an allegation the government has repeatedly refuted. The Opposition parties have claimed the Centre is robbing the states of the right to self-determination, besides violating the Constitution.

New Delhi:

Prime Minister Narendra Modi “inherited a very fragile economy” – from the preceding Congress-led United Progressive Alliance government – and, while progress has been made to a ‘viksit (developed) Bharat’, more must be done, Dr Arvind Panagariya, 16th Finance Commission Chairperson, told NDTV.

But assuming these challenges are overcome, that goal – a ‘developed’ nation, one for which a sustained growth of around 7.6 per cent, till 2047, is seen as a minimum – is “very much doable”, he said, pointing to reports that India’s GDP is likely to grow at nearly eight per cent for 2024/25.

“We forget, actually, the PM inherited a very fragile economy. In the last two or three years of UPA rule, things had really gone south. This was when some of the worst laws were enacted…” he said, highlighting legislation dealing with the right to education and acquisition of land.

“We had the Right To Education Act, which ended up being more of a barrier to quality education than promoting it, (and) we had the Land Acquisition Act, which clearly made the task of the PM who succeeded the UPA incredibly hard in terms of land being priced very highly,” Dr Panagariya said.

He pointed to the cost of acquisition of land, “even in a linear project, such as roads”, explaining purchase of land becomes three-fourths of the project’s cost. “What that means is… for the same resources, (instead of being able to) construct 2 km of road… you are able to construct only 1 km.”

Dr Panagariya also flagged other “fragilities” in the economic and administrative system inherited by Mr Modi, such as environmental clearances for infra projects “in a way hardly any projects were progressing”. “So, those bottlenecks had to be cleared up (and) then the PM proceeded to deal with more difficult reforms,” he said, pointing to abolition of red tape, GST, and the bankruptcy code.

Looking forward, he identified execution of the four labour codes as a key step, saying, “… we had enacted these in 2019/20… but implementation is still to be done. Once that is done… there is a whole host of reforms to do with income tax, privatisation, and higher education reform.”

Attention must also be paid to other infrastructure needs, such as railways and civil aviation and, most importantly, that related to digital payments, Dr Panagariya told NDTV.

Despite these challenges, he said he is confident ‘viksit Bharat’ is an achievable dream.

“For the last 20 years… if I take 2003/4 to 2022/23, India’s GDP growth rate in terms of (current) dollars (is) 10.2 per cent. People do not realise… in dollar terms we have grown very rapidly. Indeed, even if I take out the GDP deflator for that – which is the US GDP deflator, because we are talking in terms of dollars – India’s GDP growth rate in real dollars ends up being 7.9 per cent for this period.”

New Delhi:

Artificial Intelligence, like any new technology, will destroy new jobs but also create new ones, Chairman of the 16th Finance Commission Dr Arvind Panagariya said during a fireside chat at the NDTV Emerging Business Conclave. He added that new technologies are known to raise productivity, reduce cost of production and expand economic activity.

Dr Panagariya said that in adopting new technologies, as tried by companies like Tesla and Adidas, the key factor is if automation will make the production process less costly. “Adidas opened automated facilities in Germany and the US, but had to move back to China,” he cited an example.

The economist said that Micro, Small and Medium Enterprises (MSME) remain a source of employment, but their growth is critical to ensure they remain productive in the race towards the 2047 Viksit Bharat goal.

Talng about skilling in MSMEs, Dr Panagariya said skill education helps, but the learning is always on the job. He added that capital is also needed to ensure skilling. “If the ecosystem they work in is large or medium, workers have to up their game. If the ecosystem is defined by less capital, there is no drive to acquire skills,” he said. He also said that part of the problem that plagues India’s MSME sector is the lack of medium enterprises.

Dr Panagariya said the success of MSMEs lies in ramping up production, which likely takes rural areas and turns them urban. “In Schengen, which started as a bunch of fishing villages is the most urbanised region on the Earth,” he said, crediting the power of industrialisation.

New Delhi:

Sixteenth Finance Commission Chairman Arvind Panagariya on Friday said that he would be casting his vote for the first time when Delhi goes for poll on May 25.

“The young are not the only first-time voters. 50 years after becoming eligible, I am excited to be voting for the first time this election season. Can’t wait for the day Delhi votes!!,” he said in a post on X.

The young are not the only first-time voters. 50 years after becoming eligible, I am excited to be voting for the first time this election season. Can’t wait for the day Delhi votes!!

— Arvind Panagariya (@APanagariya) April 19, 2024

Mr Panagariya, a Professor of Economics and the Jagdish Bhagwati Professor of Indian Political Economy at Columbia University (USA), served as the first vice chairman of the NITI Aayog between January 2015 and August 2017.

Born in September 1952 Bhilwara, Rajasthan, Panagariya was appointed Chairman of 16th Finance Commission in December last year. 

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)