Tamil Nadu on Monday constituted a five-member economic advisory council to the Chief Minister - which includes Nobel Prize-winning economist Esther Duflo and former RBI Governor Raghuram Rajan - to guide Chief Minister MK Stalin in managing the state's economic and social policies.
Other members are Arvind Subramanian, former Chief Economic Advisor to the Government of India; Jean Dreze, welfare economist and social scientist; and S Narayan, former Union Finance Secretary and former Economic Advisor to Prime Minister Narendra Modi.
"The fiscal situation of Tamil Nadu is precarious with persistent high revenue and fiscal deficits, and a large overhang of debt. At the same time, expectations of people are very high... that the Government will deliver on faster economic growth, social justice and equality...," the state said in its notification.
The council, it added, will provide general guidance on economic and social policy, social justice and human development-related issues, and in matters related to equal opportunities for women and well-being of underprivileged groups.
It will also make suggestions to boost growth, employment and productivity across all sectors, as well as act as a sounding board for ideas that might resolve roadblocks to development.
The council will meet in person, or virtually, to fulfill its responsibilities, and will decide its own operational modalities to achieve its objectives, the state added.
Earlier today, at the second sitting of the opening session of the new Legislative Assembly, Governor Banwarilal Purohit said: "The government will revitalise the state's economy and ensure that benefits of economic development reach all segments (based on) recommendations of the advisory committee."
He also said a white paper detailing the state's financial situation would be released next month, stating: "The fiscal health of the state is a cause for concern."
The state government has a Rs 5 lakh crore debt and interest payment for this is a huge challenge, particularly amid the pandemic.
Ahead of the April election the DMK had promised a cut in fuel prices, a monthly allowance of Rs 1,000 for housewives and waiver of student educational loans, none of which were mentioned by the Governor in his address.
With the pandemic and the lockdown putting severe dents in the state's revenue streams, in addition to restoring the economy the new council will have to find ways to accommodate these promises.
Establishment of the new council comes days after Chief Minister Stalin met Prime Minister Modi in Delhi. The two discussed several issues, including providing more Covid vaccine doses to the state to ensure speedy inoculation of its population and aid in the re-opening of the economy.
On Sunday the state announced major relaxations in lockdown rules as it looks to jumpstart a stuttering economy. These included re-starting of shooting for the film and TV industry, construction work in four districts and limited opening of e-commerce and restaurants.