Former Prime Minister Manmohan Singh slammed the government, for its vendetta policies, all-round- mismanagement of the economy, and manmade blunder of demonetization and hastily imposing GST caused the economic slowdown in India. The video has been released by former PM in response to the ongoing meltdown in the economy of the country.
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At present, the GDP has slowed down to 5% and had started showing a decreasing trend since January-March 2016 quarter, where after the GDP growth rate has been continuously declining. In April-June 2016 quarter, GDP growth rate slipped to 7.9 percent – a decline of 1.3 percent then further to 7.5 percent in the quarter ending September 2016. Then GDP rate declined to 5.7 percent for the April-June 2017 quarter. Even RBI annual report showed that the bold move of demonetization did not go for the Modi government as planned. The move of demonetization affected the unorganized sector growth rate by up to 80 percent, also resulting in loss of lakhs of jobs.
Besides, demonetization imposition of GST further paralyzed the manufacturing sector, affecting the pre-production sector completely. Interesting enough Union Home Minister Amit Shah in a convocation ceremony at Pandit Deendayal Petroleum University in Gujarat’s Gandhinagar city claimed that the economy is currently growing at the fastest rate of 7% as compared to other countries as the country’s macroeconomic fundamentals were quite strong, PTI reported.
On the contrary BJP’s leader Subramanian Swamy on Saturday rued that the country may not reach its target of being a $5-trillion economy if “no new economic policy is forthcoming” after the data revealed that India’s Gross Domestic Product growth falling to 5% in the April-June quarter – the fourth straight quarter of slower growth and the slowest growth in over six years. He further stressed that “Neither boldness alone or knowledge alone can save the economy from a crash,” Swamy tweeted. “It needs both. Today we have neither.”
To revive the economic meltdown in-country, Union Finance Minister Ms. Nirmala Sitharaman announced a set of measures to prop up the economy. Aiming to make public sector banks more independent and accountable Ms. Sitharaman announced the merger of 10 public sector banks into four entities. The announcement is made in, less than two months after presenting the Union Budget.
According to Mckinsey’s latest report, the pressure on the Indian business sector is increasing faster than many major economies across the globe. But 43% of Indian companies are currently in long-term debt that has an interest coverage ratio of less than 1.5%, which is higher than any other Asian country by some distance.
Our neighboring country Bangladesh has defied India in both economic and political gravity. Since 1971 after the country achieved independence from Pakistan, the country has been witnessing a long list of tragedies like wrenching poverty, natural disasters and now one of the world’s biggest refugee crises, after the influx of 750,000 Rohingya Muslims fleeing persecution in neighboring Myanmar. Yet remarkably Bangladesh has become one of the world’s economic success stories. According to the World Bank, the country has a 166 million-plus population with people living in extreme poverty as under $1.25 per day — has shrunk from about 19% of the population to less than 9%. Per capita income has risen nearly threefold since 2009, reaching $1,750 this year. The country is becoming a fast-growing manufacturing sector in the garment industry which is second only to China. The economy of Bangladesh has averaged above 6% annual growth for nearly a decade, reaching 7.86% in the year through June.
Similarly, the GDP of Nepal is expected to grow at 7.1% driven mainly by the service and agriculture sectors. The service sector like retail, hotel, and restaurant are picking up increasingly boom of tourist arrivals and remittance-fueled private consumption. Agriculture growth has increased, due to good monsoons, increased commercialization, availability of fertilizers and seeds, and improved irrigation facilities.
At present, the condition of other south Asian countries is better than India, whose GDP growth has slowed down from 5.8% to 5.7% in the second quarter of 2019. It is the weakest growth rate since the first quarter of 2013. the annual GDP growth rate in India from 1951 until 2019 averaged to 6.20% and had even reached an all-time high of 11.40 percent in the first quarter of 2010 contrary to a record low of -5.20 % which was recorded in the fourth quarter of 1979.
The Article is written by
Dr. Iram Rizvi who has a Ph.D. in Media and Journalism.
Opinions expressed in the article are of his personal and not of The Policy Times. For facts and credibility, viewers are requested to reach the author.