Tamil Nadu will set up an advisory panel comprising Nobel laureates, former Reserve Bank of India governor Raghuram Rajan, and former CEA Arvind Subramanian to reverse the slowdown in its economy. The panel will chalk out a plan to put the state on a growth path, the state Governor Banwarilal Purohit said in a speech at the Legislative Assembly on Monday.
The council will include Nobel Laureate Prof. Esther Duflo of the Massachusetts Institute of Technology (MIT), USA, Prof. Raghuram Rajan, former Governor, Reserve Bank of India, Dr. Arvind Subramanian, former Chief Economic Advisor, Prof. Jean Dreze, Development Economist and Dr. S. Narayan, former Union Finance Secretary.
The panel is part of an effort to base the government’s economic decisions on the strong foundation of data. The government will release a white paper on state finances in July, the Governor said.
“In recent years, we have seen a slowdown in Tamil Nadu’s economic growth rate. This government will make all efforts to reverse this trend and usher in a period of rapid economic growth taking full advantage of the available limited window of the demographic dividend. To chart out a rapid and inclusive economic growth path for the state, the Government of Tamil Nadu will constitute an “Economic Advisory Council to the Chief Minister” with the leading experts from all over the world as its members,” the Governor said.
Tamil Nadu has been running up a significant debt over the last few years even as successive governments stepped up welfarist measures. In the interim budget presented by O Panneerselvam in February 2021, the debt estimate was over Rs 5 lakh crore in 2021-22, the state was also expected to suffer a widening revenue deficit as State’s Own Tax Revenue was expected to take an 18% dip as a result of the pandemic.
The DMK government has just rolled out a massive cash dole scheme of Rs 4,000 a family under Covid relief. The state’s new finance minister Palanivel Thiaga Rajan has been an avowed critic of the Centre’s tax distribution mechanism, pointing out that Tamil Nadu has been receiving less and less against increasing contribution to the central tax pool over the last two decades.