Dr Raghuram G Rajan, the Governor of the Reserve Bank of India (RBI), shared his insights on two occasions at HKUST in November with audiences that included senior leaders of business, academia and government and recent graduates.
As part of the HKUST 25th Anniversary Distinguished Speakers Series, Dr Rajan spoke to an elite audience of more than 50 leaders, including HKUST President Prof Tony F Chan, the Consul General of India Mr Prashant Agrawal, and Hong Kong’s Secretary for Financial Services and the Treasury (and former Dean of the School), Prof KC Chan.
The talk, moderated by Dean Prof Jitendra V Singh, was on “Debt and Capitalism” – a topic Dr Rajan is well-acquainted with having been RBI Governor since 2013, former chief economist of the International Monetary Fund, author of the award-winning Fault Lines: How Hidden Fractures Still Threaten the World Economy, and recently, the first Indian elected vice-chairman of the Bank for International Settlements.
Dr Rajan warned: “Debt is like dynamite. It can be very useful depending on the situation, but we must handle it with caution and care.
“With proper use of debt, we have a better way of freeing up resources to bring our society forward. But every society, and government, should always remind themselves that the debt level ought not to get too high, and resist the temptation to over-borrow.”
Dr Rajan also gave the commencement speech at HKUST’s 23rd congregation, where he was conferred a Doctor of Business Administration honoris causa. He spoke on the need to restore public confidence in markets given concerns about inequality, and to resist the temptation of easy, populist solutions.
“We must increase access to the market for all, and we must promote equal opportunity in the job market, regardless of gender, race and background. Only then will society raise its tolerance of a free market,” he said.
