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| Chadha and (right) Rangarajan: Busy schedule |
Calcutta, June 3: Their job is to think and they are doing just that, in a departure from past practice.
Five men ? all economists like the Prime Minister ? are working overtime on a host of issues that Manmohan Singh has identified for his economic advisory council, the “busiest in the recent past” as a member of the previous regime’s think tank described it.
One of the immediate tasks before the council, headed by former Reserve Bank governor and chairman of the 12th Finance Commission C. Rangarajan, is finding a solution to the stand-off over taxing exporters on their profit.
Under the duty entitlement passbook scheme, exporters enjoyed the option of no tax or duty on export of goods. While the finance ministry is trying to mop up over Rs 10,000 crore by taxing exporters, the commerce ministry is opposing the move.
Singh has turned to the council to find a way out. Rangarajan and his men ? Suresh Tendulkar, former director of Delhi School of Economics, M. Govinda Rao, director of National Institute of Public Finance and Policy, Saumitra Chaudhuri, chief economist of the credit rating agency ICRA, and G.K. Chadha, vice-chancellor of Jawaharlal Nehru University ? are scheduled to submit their report this month.
“This is the busiest council in the recent past. Atal Bihari Vajpayee had a huge advisory council with representatives from industry, academia and political circles. But that was more an ornamental committee and the job was primarily endorsing various government policies,” said a member of the former Prime Minister’s economic advisory council.
He added that meetings were irregular ? once the council met after six months ? and the last meeting took place in August 2003.
The team is also working on matters related to growth and development, implementation of the controversial value-added tax across the country and the feasibility of pressing ahead with rural employment guarantee schemes.
The areas for each member are well defined: Tendulkar looks at macroeconomic issues, Chaudhuri focuses on monetary economics, Chaddha works on agro-economics and Rao handles public finance and policy.
Although happy with the performance of Singh’s council, the member of the previous think tank stressed the need for policy debate.
“The reports prepared by the team should be made public to facilitate discussion. Sukhamoy Chakraborty, who headed the council during Indira Gandhi’s time, used to make the reports public to invite interaction,” he said.
A member of the current committee said Singh wants them to “look into the state of finances” of the seven northeastern states as they have “become a matter of concern”.
The other important task before the team is preparing monthly reports on the economy and presenting them to the Prime Minister with suggestions.
“These days, various agencies come up with forecasts on some key macroeconomic parameters. We are also considering the possibility of coming up with our forecasts,” the member added.