Raghuram G Rajan, former International Monetary Fund (IMF) chief economist and currently Chicago University professor famed for his perceptive warnings about the global financial crisis of 2008, is set to take over as India’s new chief economic advisor this week.
Rajan will take charge on Wednesday, two days before the government is set to announce its national income data for the April-June quarter, said sources.
Rajan will replace Kaushik Basu, whose term ended on July 31 and has returned to Cornell University to don his academic robes once again.
Rajan (49), a PhD from Massachusetts Institute of Technology, is known for his outspoken views about India’s economic management.
He is of the view that immediate steps need to be taken on key aspects of second generation reforms such as raising retail prices of fuel, deregulate and align these with international crude price movements.
Many expect Rajan, who has studied at IIT Delhi and IIM Ahmedabad, along with finance minister P Chidambaram to steer India’s economy out of a web of mess, from a sharp slowdown in growth to a free-falling rupee, from industrial deceleration to rising prices.
From a country-wide Goods and Services Tax (GST), to a direct taxes code (DTC), from allowing foreign direct investment (FDI) in pensions and insurance sector to opening up of the banking sector, Rajan is expected to frame policies on the unfinished reforms agenda, most of which Chidambaram had unveiled in his stint as finance minister in UPA I between 2004-08.
His recent book, Fault Lines: How Hidden Fractures Still Threaten the World Economy, won the Financial Times Business Book of the Year award in 2010.