New Delhi: Days after the Finance Ministry reported contraction in the GDP growth, former Prime Minister Manmohan Singh on Sunday slammed the Narendra Modi government blaming its policies for the economic slowdown in the country.
“India has the potential to grow at a much faster rate, but the all-round mismanagement by the Modi government has resulted in this slowdown,” said Singh, who is also an eminent economist.
Calling the slowdown a “man-made crisis”, Singh, in a detailed statement, primarily blamed the Modi government’s decision of demonetisation and a “hastily implemented GST” for the current state of economy.
Even last year, on second year of demonitisation, Singh had hit out at the government for the ‘wounds’ of currency ban move. “It is often said that time is a great healer. But unfortunately, in the case of demonetisation, the scars and wounds of demonetisation are only getting more visible with time,” he had said in a statement.
Even then, he had called the move an “economic misadventures”. However, late Arun Jaitley, who was then Finance Minister had countered Singh calling it a “key step in a chain of important decisions taken by the government to formalize the economy”.
As for the GST, it was the brain child of the Congress. Hence Singh only blamed its implementation, not the idea per say. Even before GST was passed midnight 2017, it was Manmohan Singh who had supported the GST Bills and had told Congress not to break the consensus simply because the treasury bench would perceive to be taking the credits of it. Singh had also called the step as favourable for the country.
Two years on, he criticized it but for its “hasty implementation”.
The Congress on Sunday shared Singh’s statement on its official Twitter handle indicating that it was the party’s position as well. With senior party leader and former Finance Minister P. Chidambaram in CBI custody, Manmohan Singh is the only credible face the Congress has to speak on the economy.
The Congress leader said more than 3.5 lakh jobs had been lost in the automobile sector alone and he claimed similar large-scale job losses in the informal sector.
“Domestic demand is depressed and consumption growth is at an 18-month low. Nominal GDP growth is at a 15-year low. There is a gaping hole in tax revenues. Tax buoyancy remains elusive as businessmen, small and big, are hounded and tax terrorism continues unabated. Investor sentiments are in the doldrums. These are not the foundations for economic recovery,” he said.
Highlighting the rural distress, Singh said: “Farmers are not receiving adequate prices and rural incomes have declined. The low inflation rate that the Modi government likes to showcase comes at the cost of our farmers and their incomes, by inflicting misery on over 50 per cent of India’s population.”
Citing RBI’s transfer of Rs 1.76 lakh crore to the government, the former PM also accused the latter of attacking the autonomy of institutions.
The current economic slowdown has started to hurt corporates as well, with many companies reporting a sharp decline in revenue as well as profit growth numbers in the last quarter. Meanwhile, Finance Minister Nirmala Sitharaman once again reassured the country that things are under control and reforms are being taken to ensure the slowdown is arrested.