Former CEA Deepak Nayyar has warned that the current global economic and political disorder could last until 2050. He compared the current era to the late 1920s and also raised concerns over India’s inflation and unemployment issues.
Global economic and political disorder could persist for another 25 years until 2050, with little prospect of a major improvement in the current global situation, former Chief Economic Adviser to the Government of India Deepak Nayyar has warned.
Speaking to ANI on the sidelines of the “Pathways To Viksit Bharat” event, Nayyar compared the current global environment with the economic and political instability witnessed nearly a century ago. “The main takeaway is that there is economic and political disorder in the world,” he said.
Global Situation Compared to 1920s
Drawing a historical comparison, Nayyar stated, “This world in the late 2020s looks much like the world in the late 1920s.” He further warned, “I do not see that there will be any substantive change in this disorder. It’ll take at least a quarter century until 2050, by the time it works itself out.”
His remarks come at a time when geopolitical tensions and economic uncertainty have raised concerns over the outlook for global growth, trade and investment.
Concerns Over Indian Economy
Turning to India’s economic challenges, Nayyar expressed concern over rising inflation and its impact on household purchasing power, particularly as most workers do not receive automatic wage increases to compensate for higher prices.
“I worry about inflation, particularly in a country like India, where the indexation of incomes is for a tiny fraction of the workforce,” he said. He noted that rising prices of essential commodities such as vegetables, rice and sugar were reducing the real incomes of households.
Call for GDP Transparency
Nayyar also called for greater transparency in India’s GDP calculations, questioning the use of the GDP deflator to arrive at real economic growth figures. “I think the government needs much more transparency. Why is it that they use this GDP deflator? I think the people of India would like to know,” he said.
Employment and Demographic Issues
On India’s long-term economic prospects, he expressed concern over declining fertility rates and the lack of adequate employment opportunities. “People are the most important resource. They are our most abundant resource. Sadly, we have not been able to create employment, which means that the most abundant resource is underutilised,” Nayyar noted.
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