‘Maybe dead bodies do move’: Arvind Panagariya on Trump’s 'dead economy' jibe, calls crisis India’s 1991 reboot

Finance Commission Chairman Arvind Panagariya, dismissed the US President’s “dead economy” swipe and pointed to India’s surging growth and export potential and said “maybe dead bodies do move”.

Speaking at the BT India@100 Summit on Friday, Panagariya said India’s growth trajectory contradicts Trump’s rhetoric. “India is an open economy. You don’t grow at 7% plus if you’re dead. In dollar terms, we’re moving even faster.”

He described the current global trade environment as a “1991 moment” for India — citing crisis and opportunity in equal measure. “Trump’s 50% tariffs are a problem, but they force us to look inward and recalibrate. If the U.S. market closes, we must pivot.”

Panagariya urged the Centre to expedite a free trade agreement with the European Union, arguing that India can edge out competitors like Vietnam. “We face high U.S. tariffs, but lower ones in Europe. Our exports can shift, displace Vietnamese goods. The profit motive is strong.”

He pointed to post-COVID merchandise exports rising from $19 trillion to $25 trillion by 2022 as proof of India's potential. “If we set our house in order, nothing can stop our growth. There’s considerable room for acceleration.”

On domestic policy, Panagariya called out delays in implementing labour reforms. “The four labour codes passed in 2019–20 haven’t been notified. No parliamentary action is needed. There’s no better moment than now.”

He also challenged state-level policy inertia on land use. “Urbanisation isn’t just about people living in cities—it’s about building cities that enable business. Land is underused because of outdated zoning and conversion rules.”

States like Telangana and Uttar Pradesh, he said, have made encouraging starts by reducing clearance hurdles. “Others should follow. Land is difficult to acquire, and FSSAI rules further stifle movement.”

Panagariya said regulatory overload continues to strangle exports. “We’re possibly the only country where exports face more red tape than imports. This must change.”

Despite rising global protectionism, Panagariya remained confident: “We’ve overcome bigger crises. With good policy and entrepreneurial freedom, India’s growth story is far from over.”