New Delhi: Arvind Virmani, currently principal adviser, Planning Commission, will take over as the 13th chief economic advisor (CEA) at the department of economic affairs, ministry of finance.
The 58-year-old economist will replace Ashok Lahiri, who has moved to the Asian Development Bank as executive director.
In some ways, it will be homecoming for Virmani, a former Ph.D. student of Nobel laureate Prof. Kenneth Arrow. While he started out in the Planning Commission as an economic adviser in 1987, he moved to the finance ministry in 1991, just months before the economic crisis afflicted the country.
Though Virmani declined to comment on his new assignment, he was willing to reflect on that moment of crisis, when he served in the finance ministry as adviser to the then finance minister Manmohan Singh—who, coincidentally, had earlier served as the CEA. “Before 1991-92, we had no historical experience in dealing with such large capital flows. In that year, we saw a surge in capital inflows by $6 billion,” Lahiri said.
Much has changed since. Seventeen years later, India is now struggling to manage the surfeit of foreign capital inflows into the country and foreign currency reserves topping $200 billion (Rs8.1 trillion).
“Now, it is a matter of scale. They are so much higher,” he said. “The key thing about macro-economics is that nothing is static. There is always something new,” he added
Virmani also formerly served as the director of economic think tank Indian Council for Research on International Economic Relations.
As CEA, Virmani will, among other things, be responsible for bringing out the country’s economic survey document—a summary statement that documents economic progress in the year.