Does that mean that the Reserve Bank and the finance ministry are on the right path?
I think broadly they are in the right direction. One would like to see more speed. Here I am talking as an Indian and not as a future chief economist of the IMF. Second, it will be really good if we see a roadmap. In that roadmap it also must indicate reduction of the government control over the public sector banks. This does not necessarily mean privatisation but the reduction in government control otherwise the government will continue to interfere in the areas of credit, etc. Are there powerful disincentives in public sector banking? I think there are distortions of various kinds, both positive and negative towards the public sector banks. Interest rates have come down but not for every corporate. How do you react to that? One of the problems in India is the huge fiscal deficit and the question is how much is that crowding out private credit. I do not think that we have a clear cut answer. In the long run, if you have such a huge fiscal deficit, eventually, it start crowding out pri
