In policymaking, one must be prepared to fail: CEA

“…some people say that it is very costly. How can it be costly? If they don’t produce, they don’t get paid. There is no fiscal cost. If they succeed in producing above the benchmark, then they get paid. That’s a fairly sensible arrangement”. “If you are somebody who has ever done any investing, you would understand that not everything that you invest in is going to succeed. So even as a venture capitalist, if some sectors of the 14 sectors succeed and you are able to establish a global presence in the global supply chains in those sectors, this will still have achieved its purpose. Students of public policy should remember, policymaking itself is an entrepreneurial venture. But you have to be prepared to fail, you have to be prepared to reverse course if it fails, and you have to have the information and the data to know whether you are succeeding or failing. But it cannot be rigid, it cannot be ideologically driven, and it has to be based on the context,” he said while speaking at a discussion organised by the University of Chicago’s Harris School of Public Policy.

On India’s growth, Nageswaran reiterated India’s potential growth rate is in the range of 6.5-7 percent. He also pointed out the risk posed by extreme heat conditions to agricultural output.

“Naturally, it’s going to be an important challenge to handle if these weather forecasts – which are no better than economic forecasts – turn out to be accurate,” he said.