NITI Aayog vice-chairman Rajiv Kumar says trade deficit greater concern than rupee

New Delhi: NITI Aayog vice-chairman Rajiv Kumar said on Tuesday that he was more concerned about the rising trade deficit than the falling rupee, and called for efforts to push exports.

He also said that there is a constituency which benefits from strong rupee but it needs to be put on the back foot.

"I don't believe in strong rupee... It will be very difficult for the government to try and push up the rupee," Kumar said at an event organised by industry body CII.

"There is a constituency that benefits from strong rupee...The constituency should be put on the back foot," he added.

The rupee on 16 August had slumped to a life-time low of 70.32 on strong demand for the US dollar.

Kumar further said that economic policy making should not focus only on fiscal deficit number, arguing that large economies like USA, China and European Union do not give much importance to fiscal deficit.

File image of Rajiv Kumar, Vice-Chairman of NITI Aayog. PIB image

File image of Rajiv Kumar, Vice-Chairman of NITI Aayog. PIB image

"We must shift debate out of fiscal deficit. Countries like USA, China and the European Union don't give (importance) to it... We need to move from that single, one number (fiscal deficit).

"Nobody is playing by rules, so we should learn to play as it suits our requirements," Kumar insisted.

He said however that some revenue expenditure can be just be brought to zero.

The main worry, he added, is a trade deficit.

"I think it will be much better to try and push exports," he noted.

Kumar argued that under the current circumstances, tightening fiscal and monetary policy at the same time would be asking for trouble.

He also suggested that India should not boast of being a big economy while negotiating trade deals as the country's per capita income is still low.

He said NITI Aayog will soon come out with development agenda for 'New India 2022'.

"We would like Planning Departments of State governments to work as State NITI Aayog," he said.

Replying to a query, Kumar said nearly all states (excluding four) have signed MoU with the Centre for implementing Ayushman Bharat Healthcare Scheme.

"I met West Bengal chief minister Mamata Banerjee, she is also willing to come on board," he said.


Updated Date: Aug 21, 2018 16:20 PM

Also See