Finance Minister Arun Jaitley Tuesday refuted media reports that he had criticised Reserve Bank Governor Raghuram Rajan on not easing the interest rate in his address Monday at the Make in India workshop."There was not a single sentence reference (not even a word) in my entire speech on either the Reserve Bank or its Governor," the finance minister said in a Facebook post. Saying he had only suggested steps to improve India's manufacturing capabilities, Jaitley posted: "What is reported is a speech that I did not deliver." "One of the many points that I made was that the cost of capital has to be cut down. Any one speaking on the subject of ‘Make in India’ into a manufacturing hub would necessarily suggest this," he added.
Rejecting the contention of economists against India adopting an export-led growth path, Jaitley said Monday the Make in India programme is about manufacturing quality products at low cost and whether these are sold in India or abroad is not relevant."Whether Make in India is made for consumers within India or outside is not so relevant. The principle today says that consumers across the world like to purchase products which are cheaper and are of good quality. They hire services which are cheaper and good quality," Jaitley said referring to the changes wrought by globalisation at a national workshop here on the programme. Earlier this month, Reserve Bank Governor Raghuram Rajan had said Make in India assumes an export-led growth path like China's and should rather focus on manufacturing products for the domestic market.
"There is a danger when we discuss Make in India, of assuming it means a focus on manufacturing, an attempt to follow the export-led growth path that China followed," Rajan said. "I am counselling against an export-led strategy that involves subsidizing exporters with cheap inputs as well as an undervalued exchange rate, simply because it is unlikely to be as effective at this juncture," he added. On the report of his speech in the media, Jaitley said it "convinces me that in the competitive world of journalism, reporters are always looking for an 'angle'. Where none exists, the speech itself can be twisted to create one."