India's problems homegrown: Economist Arvind Panagariya

India's economic problems are a domestic creation. That's the word coming in from Arvind Panagariya the economics professor at Columbia University. In an exclusive chat with CNBC-TV18's Siddharth Zarabi, Panagariya said India took growth for granted and the last 10 years has been a 'lost decade'. But he also expressed hope that the economy can turnaround over the next 12 months.

"My own assessment is that we are seeing a little too grim. I personally have been an optimist on the Indian economy. I feel little disheartened for sure in view of the lot of the indicators but I think in another year – year and a half you will see the turnaround happening," he says. "It is things that we did not do right in the last several years. My own thinking is that we lost almost 10 years, certainly nine and a half years under the present government – UPA-I and UPA-II. We took growth for granted. Right from the beginning, 2004 when the UPA government came into power, they were: 'we want reforms with human face'. And my reaction always was that reforms do have a human face. In the end, we are not doing reforms for their own sake or for the sake of growth. In the end it was for the poor that we are doing it and even back then in 2004 if you looked at the poverty numbers – poverty was declining," he says. "To say that reforms did not have a human face was a bad beginning and from there on we kind of went downhill. So, this is a sort of background to what the current situation is. What I want to emphasize is that, true that we have suffered from the rising interest rates in the United States or expectations of rise in interest rates in the United States but large part of our problems and therefore the solutions are domestic," he adds.