Spare us lectures from destroyers of economy
It is ironical that Manmohan Singh and P Chidambaram, the two politicians primarily responsible for the near destruction of the country's economy during their concurrent tenures as Prime Minister and Minister for Finance respectively, should be alleging that the economy is on a downturn since the Modi-led Government assumed power. It requires a certain amount of brazen shamelessness to do so, but they have done it! On Monday, ahead of the presentation of the Economic Survey of India, the Congress stalwarts released a nearly 80-page document to contend that the Union Government was “hiding” behind numbers and that employment creation was abysmally low. Singh cited the International Monetary Fund's (IMF) projection of 6.6 per cent GDP growth in the current fiscal, as against the Government's claim of 7.6 per cent. The former Prime Minister has been saying it earlier too that the demonetisation decision had set back GDP growth. The Government has had no problem in accepting that growth will temporarily slide but said it would pick up again — and with renewed vigour — once the side effects of demonetisation get addressed over the next few months. Singh and his colleagues must remember that international agencies such as the IMF have also welcomed the demonetisation move for its intent and expressed hope that the fallouts would be effectively addressed by the Government. Indeed, several experts across the world have interpreted the decision as a bold and necessary step by Prime Minister Modi, but obviously neither Manmohan Singh nor his then Finance Minister would want to refer to those statements. In any case, the Economic Survey has said that GDP growth for the next fiscal will be in the range of 6.75 per cent to 7.5 per cent. If this holds true — and there's no reason to doubt the numbers — then clearly grounds for a rebound are being laid. The Economic Survey 2016-17 does admit that GDP growth in the current fiscal will be 6.5 per cent, something again that the Modi Government need not fret over. It is strange that Chidambaram should berate the Centre for being dazzled by GDP growth figures, given that Manmohan Singh has been relying on this very parameter to condemn the Modi Government.
Chidambaram has posed two questions: Where are the jobsIJ Where is the new capital investmentIJ There are no straight answers to them, and the former Finance Minister knows well that employment generation and capital investment take time to realise, particularly after the economy has gone through a nightmarish phase. The two Congress veterans must answer why they allowed the situation to spiral out of control to such an extent that it has become so challenging today to reverse the sentiment.
Despite demonetisation (which the Economic Survey says will impact GDP growth by 0.25 per cent to 0.5 per cent in the short term), the survey is confident that the farm sector will grow robustly (to 4.1 per cent, up from 1.2 per last year). This is contrary to the phobia the Congress has been spreading over the last three months or so of demonetisation. Besides, the positive impact of the Goods and Services Tax (GST) regime, once it is rolled out, will happen too.