According to Rajan, when it comes to democracy, India starts with an advantage as it is seen as somebody that not just the West but places like Korea and Japan want to associate with. “But it is ours to lose and this is where to some extent I think we have to be very careful,” said Rajan at the Times Network’s flagship event, India Economic Conclave.
Highlighting how Infosys came under flak for dealing with Russia, Rajan said that there is much more of a sense in the public that they can punish corporations that do not behave the way they want. “If a country is seen siding with the authoritarians, and you read every day about ‘this is a country that oppresses its minorities’ and then you hear ‘this is a country that is suppressing data on how many deaths happen’, just like other authoritarian countries, it all adds up to an image we can do well without,” he said.
Rajan, who is a distinguished service professor of finance at Chicago Booth, said that the pandemic has opened up new possibilities for cross-border services. Pointing out that 20% of the US opted for telemedicine, he said, “Why can’t telemedicine be offered from India? Right now, the National Health System in the UK is overloaded. Can we have a dialogue with the EU, and UK authorities and say we’ll take some of the load off with Indian doctors and what kind of certificate they need?” he said.
He said that with top US doctors being of Indian origin, Indian doctors already enjoyed a good reputation in there. According to him, authoritarian regimes were better placed to push manufacturing. “China grew very fast by suppressing wages and the interest rates that savers got on deposits to create strong negative real interest rates, which then fuelled industry with cheap capital.”