March 19, 2007
Economist Nirvikar Singh participates in Brookings and IMF-sponsored panel
Economics professor Nirvikar Singh was a featured panelist during a forum on the sustainability of India's rapid growth that was sponsored by the Brookings Institution and the International Monetary Fund.
The March 8 forum in Washington, D.C., explored concerns about India's recent strong economic growth--8 percent annually, with new government predictions of 9 percent annual growth through 2012. Strong growth is a powerful tool that can reduce poverty and improve living standards, but an overheated economy can fuel price and wage increases, labor shortages, and strain the nation's infrastructure.
The discussion was moderated by Lael Brainard, vice president and director of the Global Economy and Development Program at Brookings and holder of the Bernard L. Schwartz Chair in International Economics.
Singh was joined by Charles F. Kramer, chief of the IMF's division that covers India, and Shantayanan Devarajan, chief economist of the World Bank's Human Development Network and editor of the World Bank Research Observer.
Singh said India needs to invest in infrastructure to handle sustained growth and that "unglamorous" institutional reforms must be implemented, including "nitty-gritty things" like modifying budgeting, accounting, and legal frameworks, and reforming tax administration and the civil service system.
Kramer noted that housing prices have doubled in some cities and stock prices jumped 43 percent last year, while Devarajan stressed that growth has been concentrated in regions, particularly in southern India. Despite rapid growth, the rate of poverty alleviation hasn't budged in more than 30 years, and India's highly touted high-tech service sector employs only 1 million of India's 400 million workers, he said.