Arvind Subramanian Explains India's 'Price Adjustment Problem'

Former Chief Economic Adviser Arvind Subramanian told NDTV that India is not facing a full-blown 1991-style balance of payments crisis, but rather a "price adjustment problem" triggered by soaring global energy prices. He said India's long-standing subsidy-heavy approach to petroleum, fertilisers and power is becoming increasingly difficult to sustain amid rising oil prices and rupee weakness. Subramanian argued that energy prices and the rupee must adjust gradually to reflect global realities, while vulnerable groups should be protected through targeted direct benefit transfers instead of blanket subsidies.