Anti-minority image for India will hurt it’s firms, warns Raghuram Rajan

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Reserve Bank of India (RBI) Governor Raghuram Rajan

While expressing concern over minorities being targeted in India, former Reserve Bank governor Raghuram Rajan on Thursday cautioned that an ‘anti-minority’ image for the country can lead to loss of market for Indian products and may also result in foreign governments perceiving the nation as an unreliable partner.

The professor at Chicago’s Booth School of Business said that India enters the perception battle from a position of strength, alluding to credentials like democracy and secularism, but he warned that this battle is “ours to lose”.

The comments came day after bulldozers razed down several concrete and temporary structures close to a mosque in Jahangirpuri as part of an anti-encroachment drive, days after the northwest Delhi neighbourhood witnessed communal violence.

“If we are seen as a democracy treating all our citizens respectfully, and, you know, a relatively poor country, we become much more sympathetic. (Consumers say) ‘I am buying this stuff from this country which is trying to do the right thing’, and therefore, our markets grow,” Rajan said, while speaking at the Times Network India Economic Conclave.

He added that it is not just consumers who make such choices over whom to patronise, but warmth in international relations too is decided by such perceptions, as governments take a call on whether a country is a “reliable partner” or not, based on how it deals with its minorities.

He said that China has been suffering from such image problems because of its treatment of Uighurs and to an extent the Tibetans as well, while Ukraine has seen immense support because President Volodymyr Zelenskyy is seen as someone standing up to defend the ideas that a democratic world believes in.

The services sector export presents a large opportunity for Indians and the country will have to seize it, Rajan said, adding that we need to be very conscious of the West’s sensitivities on privacy.

One of the opportunities which can be leveraged is in the medical sector, Rajan pointed out, warning that being perceived as a country which does not satisfy data security and privacy concerns can make it difficult to succeed.

He also said undermining the constitutional authorities like the Election Commission, Enforcement Directorate or the Central Bureau of Investigation (CBI) erodes the democratic character of our country.

On domestic affairs, Rajan said the Indian administration will have to deal with the challenges of governance by discussing changes with key stakeholders to avoid instances like the three farm laws. The three laws were repealed last year after protests by farmers.

Meanwhile, Union Minister of State for Information Technology, Rajeev Chandrasekhar, who also spoke at the event, blamed IT companies for poor planning, saying that this lack of foresight has led to wage inflation in the over USD 230 billion sector.

He also said getting high-quality connectivity to every corner through both wired and wireless connectivity is a policy priority and the ministry is working towards the same.

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