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Day 26 – Q 2.What is the significance of the post of the Chief Economic Advisor (CEA). Has the post of CEA become a political one? Critically comment.

2. What is the significance of the post of the Chief Economic Advisor (CEA). Has the post of CEA become a political one? Critically comment.

मुख्य आर्थिक सलाहकार (सीईए) के पद का महत्व क्या है। क्या सीईए का पद राजनीतिक बन गया है? समालोचनात्मक टिप्पणी करें।


The Chief Economic Adviser (CEA) is a post in Government of India and is equivalent to the rank of Secretary to the Government of India. The CEA is head of Economic Division of the Department of Economic Affairs, Ministry of Finance, Government of India. The Chief economic adviser is either selected from inside the government (normally senior IAS officers) or from outside, like some professors of economics.



The key roles of India’s chief economic advisor are to determine the government’s overall strategy in managing the economy. The Chief Economic Advisor (CEA) advises the Government of India on matters related to finance, commerce, trade, economy. The CEA reports directly to the Minister of Finance. The CEA heads the Economic Division under the Department of Economic Affairs (DEA).

The Economic Division examines domestic and international economic trends. It undertakes research studies focusing on economic policies and management of the economy. Based on the research it provides advice to the Government of India.

Other Functions:

  • The CEA is the ex-officio cadre controlling authority of the Indian Economic Service.
  • Help prepare the government’s annual Economic Survey preceding the Union Budget, which provides a glimpse into its economic hits and misses.
  • Study and advice about financial market risks.
  • To help with advice in times of global turmoil.
  • To contribute in preparing the budget.

Office of CEA is being politicized in recent past:

  • Blame Game: Each government blames CEA of the previous government to produce overestimated data for GDP and Growth. Ex. Recent controversies over the politicisation of India’s GDP data.
  • Selection Procedure: The government constitutes a search committee to look for CEA. However, the Appointments Committee of Cabinet headed by Prime Minister gives the final approval for the appointment of the CEA. The earlier selection was done from UPSC.
  • Selection of those economists who support the government. Ex. Current CEA Supported government on Demonetization.
  • Appeasement politics: it is said that good economics is good politics. So onus comes on CEA to advise better economic policies for better politics of the government of the day.
  • CEA favours government policies when in office and when he is outside they are critical of Govt. policies. Eg. Arvind Subramanium has been critical of Indian GDP growth numbers.
  • CEA is neither a constitutional office nor a statutory office. He favours govt. of the day.
  • CEA has No security of tenure and its decisions are not binding on the government, so is not critical of government economic agenda.

But, the office of CEA still has its reputation intact because,

  • Open Selection: Candidates from public and private academic or Financial Institution are also eligible to apply for the post of CEA.
  • Selection based on academic record and talent: The last two chief economic advisors_ Raghuram Rajan and Subramanian_ had IMF-World Bank experience and academic background.
  • The advice given by CEA is considered by government and been implemented in its economic policies or acts. Ex. SARFAESI Act, IBC Act, etc.


The office of CEA should be used for its true purpose with transparency and without being it politicized for the short term political gains. It is a must for India to become a $5trillion economy by 2022.

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