An insider’s account on making of economic policy

Rachna Singh

The Economic Survey of 2017-18 with its eye-catching pink cover grabbed eyeballs. Coming from the dreary and dusty innards of the Chief Economic Adviser’s office, it was a shock to traditional number crunchers. The conservatives too balked as the official document had too much literary élan — Keats rubbed shoulders with Tagore, Shakespeare and even Sunny Deol. And yet it was this departure from tradition that made the Economic Survey an eminently readable document. The man behind this change was none other than the maverick Chief Economic Adviser (CEA), Arvind Subramaniam. 

Despite departure from tradition, the book is all that I had hoped for and more. The literary chutzpah, which sets Subramaniam apart from other stodgy economic stalwarts, is alive and kicking. Quotes from Mark Twain, Salman Rushdie, TS Eliot, and Jorge Louis Borges peppered the economic soliloquy, imparting a literary flavour to the book which is conspicuous by its absence in all books on economics and policy debates. 

The media hype about Subramaniam’s take on ‘draconian’ demonetisation had lent an almost gossipy buzz to the book making it sound like a ‘kiss-and-tell’ memoir. However, right in the beginning in the ‘Introduction’, Subramaniam clarifies that the book ‘is no gossip-laden account of intrigue…no tale of grand heroism and base betrayal’ and forewarns readers that ‘the focus is squarely on policy debates’. 

In keeping with his promise, the author delves into the rationale and genesis of the major economic policy initiatives that emerged during his four-year tenure as the CEA from October 2014 to June 2018. This was the period that saw major economic upheaval, what with the introduction of demonetisation in November 2016 and the GST in 2017. As the author of the Economic Survey, Subramaniam made a commendable attempt at a balanced analysis of demonetisation in the chapter aptly entitled “Demonetisation: To Deify or Demonise”. But that was cautious official speak about increased digitalisation and tax compliance. In this book, in the chapter ‘The Two Puzzles of Demonetisation’, Subramaniam honestly wonders why one of the ‘unlikeliest of economic experiments’ became a political gamechanger that gave the ruling government a landslide victory in UP. At the same time, there is the honest bewilderment of an economist as to why the costs were not more. 

The philosophical introspection associated with demonetisation is firmly set aside in the chapters on the GST. Subramaniam hails the introduction of the GST with its concept of ‘co-operative federalism’ as ‘The Great Structural Transformation’. What perturbs him, however, is the fact that the GST rate structure deviated significantly from the lower more palatable rates recommended by him in the Revenue Neutral Rate report. He also muses about and analyses the necessity of including supply of land and real estate as well electricity within the ambit of the GST.

The chapter on “JAM, UBI, QUBI and the Mahatma” gives a peek into the CEA’s parleys with his ‘dream boss’ that resulted in the coinage of the acronym JAM (Jan Dhan Yojana, Aadhaar and Mobile number) with its attendant policy implementation measures. The reader gets a ring-side view of the Nehruvian ‘Wipe-every-tear-from-every-eye’ philosophy that was the rationale for the genesis of the concept of JAM.

The origin of the much-publicised dialogue with the Mahatma to reflect the inherent conflict in the concept of universal basic income is also discussed. The book has a lot more to offer. From twin balance sheet to stigmatised capitalism, from Paris accord to an open denunciation of subsidies, from precocious development model to comments on the functioning of RBI — it touches upon a host of issues that were a part of the economic and policy narrative during Subramaniam’s tenure. 

The book gives the reader a bird’s eye view of the policy formulations by the men in the North Block. Insightful, eminently readable, educative — these are the adjectives that spring to mind when describing the book. To put it pithily, it is an ode to catchy writing in the realm of public policy.