No major economy has grown 10 pc without opening up of market; India should cut tariffs: Panagariya

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New Delhi, Jan 25 (PTI) No major economy has grown 8-10 per cent without opening up of market, and India should bring down tariff on industrial goods to 10 per cent, Niti Aayog former vice-chairman Arvind Panagariya said on Monday.

Participating in a virtual event organised by the Ananta Aspen Centre, Panagariya also said the government should allow non-financial corporations in the banking sector.

'Our average tariff, which was 12 per cent in the case of industrial goods, have gone back to 14 per cent, and it should at least come back to 10 per cent... Without opening of market, no major economies have grown 8-10 per cent,' he said.

Panagariya, a professor of economics at Columbia University, said India should sign a free-trade agreement (FTA) with the European Union.

'We have no issue of agriculture with the European Union (EU) because the EU is not super-competitive in agriculture. We should be willing to open our market for the EU,' the eminent economist said.

He also reiterated that India should be willing to address the EU concerns.

Noting that he is the one-man army fighting against protectionism, Panagariya said, 'During the 1991 reforms, India saw lots of opposition.' Also speaking at the event, Fifteen Finance Commission Chairman N K Singh also said there are few countries that have been able to sustain 8-9 per cent growth without significantly high exports.

Singh said that on the trade side, after new US President Joe Biden took charge, there is new trade-related opportunities for India to look ahead.

Veteran banker Uday Kotak said that bank nationalisation happened in India because of politics, not because of economics.

Kotak pitched for privatisation of some public sector banks saying that the banking is now a customer-centric business.

He also emphasised that businesses need stable tax and interest rate regimes. PTI BKS HRS hrs