Raghuram Rajan's Nominations for the 2017 Nobel Prize in Economics: Achievements and Impact
Raghuram Rajan, former Governor of the Reserve Bank of India (RBI), was prominently proposed as a candidate for the 2017 Nobel Prize in Economics. His tenure as the RBI Governor brought significant reforms that shaped monetary and fiscal policies, contributing to the stability and growth of the Indian economy.
Key Achievements of Raghuram Rajan's Tenure
Inflation: One of Rajan's primary focuses was controlling inflation. He successfully brought retail inflation down to 3.78% in July 2015 from 9.8% in September 2013, reaching its lowest levels in the 1990s.
Consumer Price Index (CPI): Rajan led the RBI in adopting the Consumer Price Index (CPI) as the key indicator for inflation measurement, aligning with global standards. This move was in contrast to recommendations from the Indian government.
Forex Reserve Strengthening: Rajan’s efforts saw India's forex reserves strengthen by about 30% in two years. During the period of depreciation, he announced that the central bank had foreign reserves worth 380 billion USD, a comfortable level for intervention if needed.
New Bank Licenses: Under Rajan's leadership, the RBI licensed two universal banks and approved eleven payment banks. This initiative is expected to bring banking services to nearly two-thirds of the Indian population that lacked basic banking facilities.
Futuristic Forecasts: Rajan's most notable theoretical contribution was his foresight on the 2008-2012 economic turmoil in the US and Europe. His predictive capabilities solidified his status among leading economists.
Appraisal and Challenges
The legacy of Raghuram Rajan's tenure at the RBI is largely appreciated, with many reforms and policies receiving high praise. However, his approach to interest rates and inflation has faced some criticism. Rajan was known for his forward-thinking and pragmatic approaches, which were instrumental in addressing the inflation challenges faced in India during his governorship.
While the evidence of his significant contributions to the Indian economy and the field of economics is strong, questions remain about his handling of certain economic indicators, casting some doubts on the awarding of the Nobel Prize in Economics.
Conclusion
Despite the controversies, Raghuram Rajan's nomination for the 2017 Nobel Prize in Economics reflects the profound impact of his leadership and theoretical contributions to the field of economics. His forward-looking approach and insightful predictions have cemented his position among the esteemed group of economists recognized by the Nobel Committee.