FM endorses models of Jagdish Bhagwati and Amartya Sen; says both are crucial

AHMEDABAD: Amid raging debate over growth models suggested by economists Amartya Sen and Jagdish Bhagwati, Union Finance Minister P Chidambaram today endorsed both of them saying they were equally important and emphasised the need to combine passion for growth with compassion for the poor.

"As far as growth is concerned, I think we need both the Bhagwati and Sen model," Chidambaram said while speaking at an event here.

"India can never be a truly happy prosperous country unless our passion for growth is combined with compassion for the poor. A large number of people in this country are poor," he said.

While Sen's model for growth advocates that India should invest more in its social infrastructure, the model put forth by Dr Bhagwati argues that mere focus on growth can yield enough resources for investing in social sector schemes.

"A most constructive economic policy is incomplete without the element of compassion..I support Dr Bhagwati's views.. there should be passion for growth and equally support Dr Sen's model which says there should be compassion for the poor," Chidambaram said.

"I think the Bhagwati model will never be complete unless complemented with Sen's model," he opined.

"Just as Dr Amartya Sen deserves the Nobel prize, I think Dr Jagdish Bhagwati also deserves a Nobel prize for his outstanding work," he said.

There is a very fascinating debate between 'growth and equity' going on between two pro-growth economic models suggested by 'titans' like Bhagwati and Sen.

"I know there are alternative narratives in politics and that is how politics should be," he said.

Citing examples of Gujarat, a state carved out from erstwhile Bombay, Chidambaram said "in democracy, people should have choice between one narrative and another narrative."

"When we look at the growth rates under the 11th Five Year Plan, Maharashtra was at 8.5 per cent and Gujarat at 9.5 per cent, not a big difference," he noted.