Finance minister Arun Jaitley on Sunday compared two reports by the International Monetary Fund (IMF) — one during the fag end of the UPA 2 government and the latest one in 2018 — to drive home his point that the NDA government has transformed the ‘weak’ economy handed down by the Manmohan Singh regime.
“We have come a long way. The last four years have seen a series of reforms, both legislative and otherwise, which have been carried out by the government,” said Jaitley on his Facebook page, referring to IMF's latest report.
Urging people to read the reports, he said the system has been substantially cleaned up and made more transparent. “Decisiveness has led to easier decision making and this made the economy stand out before several countries,” he said.
Quoting the IMF report of 2014, released in February, he said there was high fiscal and current account deficits as well as a standstill in infrastructure, power and in the allocation of natural resources.
In the report, IMF had said economic growth is expected to slow to 4.6 per cent in fiscal year (2013-14), the lowest level in a decade, reflecting global developments and domestic supply constraints. It also said headline CPI inflation is expected to remain near double digits for the remainder of the fiscal year.
The report also said that India has very little room to adopt countercyclical policies, constrained by persistently-high inflation, and sizeable fiscal and external imbalances.
“Spillovers from renewed external pressures interacting with domestic vulnerabilities are the principal risks,” it had said. Jaitley said the 2018 IMF report, on the other hand, said economic risks are seeing a downward bias.
The report said external risks include a further increase in international oil prices, tighter global financial condition, a retreat from cross-border integration, including spillover risks from a global trade conflict, and rising regional geopolitical tensions.
Domestic risks, it said, pertain to tax revenue shortfalls related to continued GST implementation issues and delays in addressing the twin balance sheet problems and other structural reforms.
It also said stability-oriented macroeconomic policies and progress on structural reforms continue to bear fruit.
Jaitley rolled out statistics from the IMF latest report to say that the economy is being transformed. For instance, quoting the report, he said growth is expected to rise to 7.3 per cent in FY'19 and 7.5 per cent in FY'20 on strengthening investment and robust private consumption.
IMF comes out with the country report every year.