India just took a big step to the right.
In a decisive move away from the country’s socialist past, Prime Minister Narendra Modi on Monday chose free-market economist Arvind Panagariya as head of a new government body replacing the 65-year-old Planning Commission, according to Reuters’ Frank Jack Daniel and Rajesh Kumar Singh.
A Columbia University professor and former chief of the Asian Development Bank, Panagariya will lead the more decentralized “Policy Commission” (part of the new National Institution for Transforming India), which is designed to be more inclusive of states and regions than its predecessor.
Many liken Panagariya to Margaret Thatcher in 1980s Britain, but he rejects that view, advocating instead for looser fiscal policy to encourage capital spending in India. (Right now, the country is unlikely to meet existing fiscal targets, but a more immediate concern for policymakers is boosting sluggish growth.)
Though India has seen some swift changes since Modi’s election last May — stocks skyrocketed, consumer confidence is climbing, and inflation is at a record low — many are disappointed with the slower rate of economic policy reform. Panagariya’s appointment could be an attempt to change that.
Read the full Reuters article here.