Economy

Government Actions Giving India an Image Problem, Says Joseph Stiglitz

Joseph Stiglitz. Credit: Reuters/Yiorgos Karahalis

Joseph Stiglitz. Credit: Reuters/Yiorgos Karahalis

New Delhi: Renowned economist and 2001 Nobel laureate Joseph Stiglitz, in Bengaluru for a talk on global inequality organised by Azim Premji University, said at a media interaction on Wednesday that India needed to recognise that the government’s actions were causing an international “image problem” for the country.

This problem, news reports have quoted Stiglitz as saying, was a direct consequence of the government crackdown on NGOs and universities, in particularly the events at Jawaharlal Nehru University earlier this year.

Hindustan Times quoted Stiglitz as saying, “The important thing to realise is that if India wants to grow as an open economy, you are part of an international community and they are making judgement, whether right or wrong, and have come to astrong view about these two events that have had a very strong effect on public opinion abroad about what is being going on in the last two years”.

“India should be aware that it has an image problem abroad. It should be a matter of concern that NGO’s are subjected to a condition that makes it difficult for them to operate. This has got a lot of attention abroad. There are very few governments that have made it difficult for NGOs to operate. Also, very few countries, mainly authoritarian ones, have engaged in the harassment of students in universities. These two events have had a strong effect on public opinion abroad,” Business Standard quoted Stiglitz as saying.

“It puts [India] in the club of countries such as Egypt, Russia and Turkey. Most people in India will not want to be in this group. These events have also have been in the spotlight and have had had an effect foreign investors,” he added.

Stiglitz, who teaches at Columbia University in the US, also said that attacks on NGOs working in the development sector would be detrimental to the country as a whole. “Organisations like Ford Foundation have played important roles in the development of India for decades,” Telegraph India quoted him as saying.

Economic advice

However, Stiglitz was positive about India’s employment guarantee act (the Mahatma Gandhi National Rural Employment Guarantee Act), calling it the “single most innovative programme (from India) for the rest of the world”.

But the economist warned against letting inequality fester and grow and being “overly obsessed” with inflation, stating that such a scenario would lead to the rise of leaders like US Republican presidential candidate Donald Trump.

“When there is high level of unemployment, inequality thrives. India should make sure that the overall economy grows at a rapid rate. That means, not getting overly obsessed about inflation. Excessive focus on inflation almost inevitably leads to higher unemployment levels and lower growth,” said Stiglitz, quoted in Business Standard.

Stiglitz also cautioned against India signing any generic drug agreements with the US, even under current President Barack Obama. “Obama is a lame-duck President, he has only a few months in office,” Stiglitz said, according to Telegraph India.

Stiglitz also said Asia should be writing its own rules. “One of the arguments put forward in the US is about maintaining American hegemony in Asia. Obama said ‘who is going to write the rules of trade in Asia?’. The response of Asia should be…Asia should be writing its own rules and not the US.”