Finance Commission chairman Arvind Panagariya advises Kerala to make good policy choices

Published 11 August 2026 · politics

Chairman of the 16th Finance Commission Arvind Panagariya on Tuesday (August 11, 2026) encouraged Kerala to make “good policy choices” to boost economic activity. Dr

Chairman of the 16th Finance Commission Arvind Panagariya on Tuesday (August 11, 2026) encouraged Kerala to make “good policy choices” to boost economic activity. Dr. Panagariya also pointed out that the State should exploit the full potential of the Vizhinjam international seaport. The Finance Commission chairman was speaking on ‘Urbanisation: The Growth Engine for Viksit Bharat @ 2047’ organised by the Kerala Lok Bhavan. “Make good policy choices. If you have good policies, entrepreneurs will decide what are the right activities to engage in. They are much better placed than economists or the government to decide,” he said. Vizhinjam port On the Vizhinjam port, he pointed out that the port’s ability to boost the economy can be exploited better with “some imaginative thinking.” “There is a lot of assembly activity that can happen there.

You can bring in components, assemble and export it back,” he said. On national-level reforms, Dr. Panagariya reiterated a need to drive reforms by privatising public sector enterprises and public sector banks. The country does not need 12 banks in the public sector. The State Bank of India (SBI) alone should suffice, he said. Urbanisation goals Panagariya underscored the need for making Indian cities business and employment-friendly spaces for speeding up urbanisation, which he described as an important component in India’s plans to become a developed nation by 2047. “Any country which we see as a developed country is very urban. Countries can urbanise without being rich.

But there are no examples that I know of where they became rich without being urban. Urbanisation is very integral to becoming rich,” he said. Creating special employment regions—building cities around jobs—was another area that should be explored in this regard, he said. Key challenges to urbanisation include the difficulties involved in purchasing urban land for businesses, land acquisition, building by-laws, unused unproductive land, land conversion rules, Dr. Panagariya said. He stressed the need to simplify land conversion regulations, especially those concerning conversion from agriculture to non-agriculture. There is no threat to agriculture in as built-up area in India—urban, rural and mining sector included—accounts for just 3.7% of the total land area, according to him.

True progress Governor Rajendra Vishwanath Arlekar inaugurated the function. Arlekar said urbanisation does not mean westernisation. It should be initiated through our roots. It should evolve through our roots, our culture, our thought process. Importing something from western countries and calling it urbanisation will not be progress in the true sense, the Governor said. The event also featured a fire-side chat between Dr. Panagariya and Srikanth Viswanathan, CEO of Bengaluru-based Janaagrahah.