World has turned more unpredictable and dangerous, global tensions inevitable: CEA Nageswaran

Chief Economic Adviser V Anantha Nageswaran

India’s chief economic advisor V Anantha Nageswaran said the geopolitical tension witnessed by the world are inevitable and the uncertainties have increased since the start of the millennium. The top economist noted that safe heaven assets such as gold are reacting to new global factors.

“Geopolitical tensions are inevitable. Uncertainties are higher now since the start of the millennium.  Gold prices are not only responding to global uncertainties, but also the value of Fiat currency,” he said during an Economic Survey press briefing.

The CEA, in his concluding remarks, noted that India has "done well", especially after Covid. However, he noted that the world  has turned more "unpredictable and dangerous" in the last few years. "We have promises to keep and miles to go before we can sleep."

Nageswaran also noted that the unconditional fiscal transfers sought by many states do have a very useful short-term loan. He noted that cash in the hands of people has several advantages, but such policies need a cautious approach.

“They put cash in the hands of the public, raises disposable income and increases spending power, no doubt. However, sustaining growth will require a careful re-prioritization, so that short term income support doesn't erode the very investments on which inclusive medium term prosperity ultimately rests,” he warned.