The Greek crisis has made headlines all over the world. Thousands have been worried about the impact of the crisis on the world economy. Indeed, closer home, we have been pondering about the effect on the Indian economy. On Monday, 13th July 2015, following a seemingly incessant 17 hours of summit talks, Eurozone leaders announced a new deal of €86 billion to rescue Greece – a third bailout. Will this pave the way for the country’s economic revival?
With this backdrop, BCC&I organized a Panel Discussion on, “The Impact of Greek Crisis” headed by top economists and diplomats, who sought the answer on 14th July 2015 in the Chamber premises (Globsyn Room).
The panel included Mr. Rainer Schmiedchen, Consul General of the Federal Republic of Germany, Prof. Ajitava Ray Chaudhuri, Jadavpur University, Prof. Abhirup Sarkar, Indian Staistical Institute (ISI) and ABP’s Business Editor, Mr. Suparna Pathak. The panel was moderated by Dr. Suman Kumar Mukherjee, Senior Professor, Principal and Dean Bharatiya Bidhya Bhavan Institute of Management Science. Almost in a unanimous voice the panelists did not find any path for Greece’s economic crisis betterment despite their present stand with EU.
The German Consul General, Mr. Rainer Schmiedchen said since Greece is a part of the North Atlantic Treaty Organization (NATO), the countries in Eurozone, which are also alliance members need to come to the aid of the country undergoing tremendous financial crisis. Furthermore, Mr. Schmiedchen said the Russians, who are expanding their influence in Eastern Europe and the Mediterranean zone, are on the lookout for the crisis to boil. He also hinted at the problem of refugees - mainly migrant workers pouring out of Greece to other European countries for a better livelihood. However, he said the cash-strapped country can temporarily opt out of the economic pact with its western neighbours to stabilize its own currency and economy and thereafter return to the EU. Prof. Ajitava Ray Chaudhuri highlighted that Greece alone cannot be blamed, and that it is very difficult to come out of the present situation. Mr. Suparna Pathak said that the Government was spending more than collecting deficits. Greece was given money and had just misused it. Prof. Abhirup Sarkar mentioned that people lost confidence in the Government as the unemployment rate was 25%. He pointed out that Greece could come out of this situation if it moved out of the Union. He also said that Greece should be allowed to spend so that the demand for goods would increase which in turn drives growth.
Will Greece revive their economy like India did, when it faced an identical condition historically and redeemed it, asked one of the participants. In reply Prof. Abhirup Sarkar (ISI) said the tie-up with EU is a big obstacle for Greece to revive their present economic plight because they cannot take step towards economic reforms independently. Meanwhile, India being a free nation was able to find the way of economic redemption from identical crisis situation during yesteryears highlighted Prof. Sarkar. Conversely, Prof. Ajitava Ray Chaudhuri of Jadavpur University said the comparison between India and Greece is not much relevant. India has a big market which paved the way for structural economic reforms, pointed out Prof. Ray Chaudhuri while rejecting the Greece-India analogy.