On Board: V Anantha Nageswaran takes over as new CEA

The government on Friday appointed V Anantha Nageswaran, dean of Chennai-based IFMR Graduate School of Business and a visiting distinguished professor of economics at Krea University, as the next chief economic advisor in the finance ministry.

The announcement comes just days before the presentation of the economic survey for FY22 and the Budget for FY23 early next week. He joined on Friday and succeeded Krishnamurthy V Subramanian, who returned to academia on December 17 at the end of his three-year term at the North Block. Nageswaran, who served as a part-time member of the Prime Minister’s Economic Advisory Council between 2019 and 2021, holds a doctorate degree in finance from the University of Massachusetts in Amherst for his work on the empirical behaviour of exchange rates.

The new CEA comes at a time when the Covid-ravaged economy is recovering from its worst contraction in recorded history in FY21 and is estimated to grow 9.2% this fiscal, albeit driven by a favourable base.

While a meaningful rebound is expected in the next fiscal (most agencies projected real growth to range from 7% to 9%), private consumption, the principal pillar of the economy, remains subdued and private investments have flowed into only select sectors.

As the Centre and the states were forced to step up spending to save both lives and livelihood during the unprecedented crisis, general government debt shot up to about 90% of GDP.

Boosting private consumption and heralding a durable cycle of investments, therefore, remain critical to India’s economic resurgence in the aftermath of the pandemic. The new CEA, being an important figure in the government’s economic policy-making, is expected to firm up ideas to deal with both external and internal headwinds, and catapult the country into a high-growth trajectory. He will also be the lead author of the annual Economic Survey.

His predecessors in recent years have used their terms in office to provide ideas for debate. For instance, KV Subramanian had advocated a “virtuous investment cycle” to achieve high growth rates on a sustained basis. Subramanian also came out with the concept of “Thalinomics”, which was an attempt to quantify what a common person paid for a full meal across India.

Nageswaran had worked for a decade for Union Bank of Switzerland (now UBS) and for Credit Suisse in Switzerland and in Singapore until 2004. Subsequently, he also served as the global chief investment officer for Bank Julius Baer & Co, based out of Singapore, until 2011.

Prior to his appointment as the CEA, Nageswaran has worked as a writer, author, teacher and consultant. He has taught at several business schools and institutes of management in India and in Singapore and has published extensively, the finance ministry said in a statement. He also holds a post-graduate diploma in management from the Indian Institute of Management, Ahmedabad.