India is not a fully liberalised economy yet, and its polices need to be smarter to withstand external factors like the anticipated cut in interest rates by the US Federal reserve, noted economist Lord Meghnad Desai said at a lecture on Tuesday afternoon at the Meghnad Desai Academy of Economics, World Trade Center, Cuffe Parade.
Lord Meghnad Desai arrives at the Meghnad Desai Academy of Economics in Cuffe Parade for a lecture titled ‘India in the global economy’. Pics/Onkar Devlekar
Desai was delivering a guest lecture to more than 70 students from colleges across the city on ‘India in the global economy’. Sounds of furious scribbling in notebooks punctuated his well-attended 30-minute talk. Speaking in his gruff voice, Desai animatedly explained graphs and curves of economic theory to the attentive audience, his shocking white hair standing out among a sea of black mops.
A student asks a question to Meghnad Desai during his lecture
With Paris currently hosting the Paris Climate Change Conference, Desai stated it would be difficult to reach a consensus on reducing effects of climate change, since the players involved have different preferences.
Desai, an Indian-born British economist and a Labour party politician, launched the Meghnad Desai Academy of Economics in Mumbai in July 2015. The academy offers a one-year certificate program in economics, in association with Mumbai University.
From Paris to US, Desai said, on the rate cut by the US Federal Reserve expected mid-December, “the rate cut will lead to a very volatile global market, and India can only survive the shock if they revise their policies.” The last time the Feds cut interest rate was in 2006.
“It is very strange that India, on one hand encourages Foreign Institutional Investors (FII) but opposed Foreign Direct Investment (FDI), even though the country is in dire need of foreign capital,” he stated as some students nodded sagely in agreement. Several students claimed they took away a lot from Desai’s talk in reference to economic theory. For others, it had more personal ramifications.
Tarishi Kumari, economics student, said Desai’s lecture made her rethink her plans of applying for a PhD in the US. “With the exchange rate going higher every day, I am rethinking my plans of applying abroad. The more devalued our rupee gets, the more number of menial jobs qualified immigrants tend to do,” she said.
It was amusing and heartening to see star struck students fishing out their phones for a picture of the economist. Normally, that is reserved for Bollywood stars and entertainers, not staid economists who are brave enough to wear beige blazers in Mumbai’s unforgiving heat. At the end of the talk, students requested for selfies, but faculty played party-pooper, hurrying the economist into another room. Evidently, selfies can wait, change in policy can’t.