Professor Jagdish Bhagwati praised Modi for scaling up trade liberalisation and foreign direct investment across sectors. Professor Jagdish Bhagwati praised Modi for scaling up trade liberalisation and foreign direct investment across sectors.

Effusive in his praise for what he called Prime Minister Narendra Modi’s “swift” and “result-oriented” style of functioning, Jagdish Bhagwati, Professor (Economics, Law and International Affairs) at Columbia University, on Tuesday sounded a cautionary note too. He warned against some of the “corrosive” issues being raised by the RSS and some members of the ruling party, which he said could derail Modi’s agenda.

“I think the PM must be saying more things to hold these people back from capturing the imagination and (instilling) possible fear among large number of people. That can’t be good for his development agenda and that is where a little push would be helpful,” said Bhagwati.

He was speaking at the Madhavrao Scindia Memorial Lecture, which was attended by top Congress leaders including former PM Manmohan Singh, former Finance Minister P Chidambaram and other former ministers of UPA-II.

While he said there is no obvious connection between social distractions and growth, Bhagwati added that it would leave an impact in the long run as it would hamper legislative decisions in Parliament.

“In a way that has led to more concern in the legislative system and he is finding solutions through the executive route… So it is this corrosive nature of things that these RSS guys are doing that worries me… In the short run, I don’t think they would do much damage, but in the medium term everyone gets fed up,” said Bhagwati.

Bhagwati praised Modi for scaling up trade liberalisation and foreign direct investment across sectors. He said that if the first revolution was in 1991, the country is now in the next phase which will be faster.

“Modi’s ability to change faster and the willingness to do are both reinforcing each other,” said Bhagwati.

Dismissing concerns about Modi centralising everything, he said, “I think that we don’t have inflexibility on the part of PM, which is what people fear that he might have.” He cited the example of Modi continuing with Aadhar, even as many BJP politicians said it would be abandoned after the UPA government was voted out.

On the Modi government not being able to make much progress on the issue of FDI in multi-brand retail, Bhagwati said: “You have to negotiate a minefield in politics. There is no way he can go against the party base — the shopkeepers and so on. But now, precisely because he has got a broader base, he is not that dependent on that traditional base. I would give him a year.”

Well known for his views on economic liberalisation and free trade, Bhagwati said he does not expect Modi to push back spending on schemes like NREGA.

Saying spending should be done out of the revenues generated, he criticised UPA-II for spending without having the resources. “That is what went wrong with UPA-II and I don’t think Modi will make that mistake,” he said, adding that Modi would follow the Gujarat Model that worked on generating revenue and then spending on social issues.

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