Financial Express recently did a special feature about 20 interesting people in India's economic reforms. In that, I wrote this profile of Vijay Kelkar.
Vijay Kelkar's is a fascinating story in Indian public policy. He started out as an economics Ph.D. and turned himself into a consummate policymaker. While he did many interesting things in the field of oil and gas, and as executive director of the IMF, I worked with him in his fiscal phase.
This involved carrying forward the tax reform agenda of the 1990s, translating the intent of the FRBM Act into a concrete workplan, leading the transformation of income tax administration through innovative institutional arrangements in the form of the Tax Information Network (where the implementation was contracted out to NSDL), analysing and championing the Goods and Services Tax (GST) and leading the 13th Finance Commission.
For most people, the idea of the fiscal reform is exhausting. Fiscal systems have many moving parts, and suffer from the political economy problem of entrenched beneficiaries. I used to get astonished at the way Kelkar, who is 20 years older than me, consistently found the energy and morale to go back into the fray again and again, chipping away at solving long-standing problems. This also taught me that while weary cynicism is a more fashionable pose, progress is only achieved through the dint of boundless optimism.
Practical people are often dismissive of the world of ideas, but that is not the Kelkar that I have known. For one thing, he made a point of reading the current global research in economics on an astonishing scale. I have been frequently humbled in finding that his knowledge of the current literature was better than mine. I suspect his years at the IMF were very useful in tooling him up in modern open economy macroeconomics, which is often a gap in the knowledge of those who experienced a closed India in their formative years. Kelkar has always encouraged me, saying that in an open society, ideas matter, so it was important to build good ideas, and to push important messages out in the public domain, even when this makes many people uncomfortable.
After decades of engagement, Kelkar is no longer active in the public policy work of the New Delhi community. However, he has begun a stint as chairman of the National Stock Exchange (NSE). Given the immense importance of the equity market in the Indian economy, and the immense complexity of ownership and governance of stock exchanges, it is indeed valuable that a person of his wisdom is performing this public service.