Subramanian had been attacked by sections of the BJP & RSS just as Raghuram Rajan and Arvind Panagariya were for being ‘Western imports’.
New Delhi: Chief Economic Adviser Arvind Subramanian Wednesday announced that he was stepping down from the post to return to the US – a surprise decision that made it the third high profile departure of a globally reputed economist during the tenure of the Modi government after Raghuram Rajan and Arvind Panagariya.
Subramanian was appointed CEA on 16 October 2014 for a period of three years and then given a one-year extension. News of his decision to quit was announced by Union minister Arun Jaitley in a Facebook post.
“Few days ago, CEA Arvind Subramanian met me over video conferencing. He informed me that he would like to go back to the United States on account of pressing family commitments,” wrote Jaitley, who held the finance portfolio until mid-May and is soon expected to return to the ministry after his kidney transplant.
“His reasons were personal but extremely important for him. He left me with no option but to agree with him.”
The soon-to-be grandfather Subramanian succeeded Raghuram Rajan as CEA after Rajan was appointed governor of the Reserve Bank of India. Subramanian said he enjoyed a “fair amount of freedom” and cherished his stint at North Block.
But sources in the know said that he was “unhappy”, especially after PM Modi announced the demonetisation of Rs 500 and Rs 1,000 currency notes in November 2016 without consulting him. “The level of discomfort had risen fairly since then,” one source said.
Finance ministry sources said that Subramanian’s name was also being considered for the role of chief economist at the World Bank. “Though he has cited personal reasons for his decision, there is a strong possibility that he will get a bigger role and it may be at the World Bank,” said a North Block official who has worked closely with Subramanian and spoke on the condition of anonymity.
Subramanian’s tenure was also not free from controversy as he had been criticised and attacked by sections of the BJP-RSS establishment just as Rajan and Panagariya were for being “Western imports”. BJP leader Subramanian Swamy had even demanded Arvind Subramanian’s resignation citing his past comments that were seen to be critical of Modi and Indian economic policies.
But Jaitley had intervened and defended the chief economic adviser.
On Wednesday, the Swadeshi Jagran Manch (SJM), an affiliate of the RSS, seemed to welcome Subramanian’s departure and said India didn’t need imported consultants. SJM chief Ashwani Mahajan told ThePrint that Subramanian lacked ideas and wasn’t aware of conditions in the country.
In his first economic survey, Subramanian underlined the need to implement central government schemes through the JAM trinity (Jandhan-Aadhaar-Mobile). Besides, Subramanian advocated increased private participation in the country’s public sector banks. He also sought immediate attention to resolve the twin-balance sheet problems of the corporate sector and lenders.
In another survey, he had spoken about the significance of a universal basic income (UBI) scheme – a mechanism aimed at poverty alleviation by directly transferring money to people’s bank accounts. This, he had said, would be critical for the development of the country.
Jaitley said that Subramanian came up with new ideas, policy reforms in the sectors of clothing, fertilisers, kerosene, power and pulses. His report on the Revenue Neutral Rate was of great use in forging a consensus which led to the constitution amendment enabling GST, Jaitley wrote.
“His instantaneous communications with his interlocutors had increased his effectiveness. The Chief Economic Advisor’s job had multi-facets to it. He is not a spokesman of the government. He is an Advisor who has to analyse and thinks several steps ahead. It is a unique responsibility with freedom to the work that he enjoys,”Jaitley wrote.
Arvind Subramanium responded to Jaitley’s post, calling his role as chief economic advisor the ‘most rewarding, fulfilling, exciting’ job he ever had. He added that he would be willing to serve the country whenever required.