New Delhi, Sep 2 (PTI) With Chief Economic Advisor V Anantha Nageswaran cautioning against 'financialisation', the dominance of financial markets in public policy, the Congress on Monday said this is already sharpening inequalities in the country and needs a policy response.

Nageswaran said on Monday that India has one of the brightest global economic growth prospects but cautioned against 'financialisation' as the country marches to the goal of becoming a developed nation by 2047.

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India's stock market capitalisation is around 140 per cent of the GDP, he said, adding, the record profitability of the Indian financial sector and high levels of market capitalisation, or the ratio of market capitalisation to GDP, give rise to another phenomenon which deserves closer examination.

Nageswaran made the comments at the CII Financing 3.0 Summit here, while clarifying these are his personal views and not his views as CEA.

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Reacting to Nageswaran's remarks, Congress general secretary (Communications) Jairam Ramesh said, "Over the decades, Chief Economic Advisors in the Ministry of Finance have often expressed themselves as professionals. This is indeed as it should be since public education is one of the CEA's key tasks."

The present Chief Economic Advisor has rightly "drawn our attention to the fact that stock market capitalisation now stands at 140% of GDP", he said.

"He (Nageswaran) has raised an alert to the rapidly increasing 'financialisation' of the economy, which he defines as the dominance of financial markets over public policy and macroeconomic outcomes. Such financialisation is already sharpening inequalities which need a policy response," Ramesh said in his post on X.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)