Former RBI Governor Raghuram Rajan may have created headlines by making his first public remarks on Demonetisation and GST during the course of an hour-long lecture at the University of California Berkeley, but that was far from all he said. Addressing a wide range of topics about the future of India, Rajan, currently a professor at the prestigious Chicago Booth School of Business, also contrasted India and China over an aspect he may be well placed to know about -- on welcoming diaspora -- over which he says India has a 'schizophrenic' attitude.
Rajan began, "One of the things China does much better than India is welcome its diaspora", elaborating, "It hunts around the world for the best and brightest and tries to persuade them to come to India."
He continued, frequently inducing laughter in the audience, "We have a schizophrenic attitude towards foreign returns. One one hand people say, 'who are these guys, what do they know about Indian conditions?'... We have a view in India sometimes -- the laws of economics work differently in India. The laws of physics work differently in India... You have to be in India... stops (laughter)"
Rajan went on: "The other view is that whatever comes from outside is golden. 'So and so is Harvard return so they're wonderful.' Neither really serves our purpose. You can't pay obeisance because someone is Harvard returns. Nor can you reject them just because they're Harvard return.
As a solution, he presented: "What you have to do, which the Chinese do very well, is listen to everyone who wants to talk and decide if they have something of value to say or nothing of value to say. They ignore those who have nothing of value no matter their pedigree and pay attention to the people who have value to say."
Elaborating on the contrast with China, Rajan, a former IIT Delhi and IIM Ahmedabad alum who had returned from academia in the US to become India's Chief Economic Advisor and subsequently RBI Governor, said:
"I would argue that some of this has to do with the Chinese experience, as it was an independent country and had its colonial experience with the Opium wars. China, a very strong country, was crushed in the Opium Wars, (cites Amitav Ghosh's trilogy). China had archaic weapons and archaic military. I believe that historical experience has made China very different today. That they're willing to absorb from the world whatever they can. They don't take what you have to say as gospel truth but they're willing to listen."
On what India should do, he adds, "Now we have to move towards that intermediate position in India -- not take it as truth, nor reject it out of hand -- how do we take what's good from it? And we have to be realistic that we want to attract more talent from India. Meaning people of any nationality, citizenship, race, colour -- we have to attract more of them. And to do that we have to provide them much better working conditions. But going forward that will be beneficial. Tomorrow, India will be a stronger, better India."