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nobel prize, economist, Paul Krugman, india

Here what Nobel Prize winning economist Paul Krugman wants India to do

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nobel prize, economist, Paul Krugman, india

Eminent economist Paul Krugman recently spoke at a virtual event organised by Ashoka University. He shared some insights on key issues that have slowed down India's economic growth. Here is all you need to know:

Nobel Prize-winning economist Paul Krugman wants India to come up with a deliberate policy for fostering industries. The noted economist also said that the country should not go back to the ‘licence raj’ era.

Krugman's comments came during a virtual event organised by Ashoka University on Monday. The noted economist highlighted that income inequality is also a major problem India faces at the moment.

During his address, Krugman said, “Don’t go back (to) Licence Raj regime. A country like India might want to have a deliberate policy for fostering industries.”

The licence raj regime, which ceased to exist after the economic liberalisation in 1991, involved a complex system of licences, permits and regulations that were required to set up and run businesses in the country.

When asked about the performance of India’s labour-intensive industries, Krugman said the country is not well suited as some other players when it comes to producing labour-intensive manufacturing products.

"Internal geography (of India) may be one of the reason. India does have a kind of non-industrial ecology," the economist noted.

The fact that India does not have good transport infrastructure has also added to India’s industrial growth woes, Krugman added.

The economist stated that the country has not done well in labour-intensive aspects, but added that the country’s services sector and high skill manufacturing are big advantages.

Krugman said he is optimistic about export-oriented growth for developing nations despite a slowdown in globalisation.

Another major problem Krugman highlighted was income inequality in India. He said, “Income inequality issue is a severe one in India. If the United States has an extremely hard time tackling extreme inequality, then I got to worry about India,” he added.

 

Source: INDIA TODAY

nobel prize, economist, Paul Krugman, india

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