Former Prime Minister Manmohan Singh on Sunday said the state of the economy was “deeply worrying” and urged the government to put aside “vendetta politics” and reach out to sane voices and thinking minds to steer the economy out of this “man-made crisis”. The Congress leader said “all-round mismanagement” by the Modi government was responsible for the slowdown.
“The state of the economy today is deeply worrying. The last quarter’s GDP growth rate of 5 per cent signals that we are in the midst of a prolonged slowdown. India has the potential to grow at a much faster rate but all-round mismanagement by the Modi government has resulted in this slow down,” he said in a statement.
Targeting the government, Singh said the country’s youth, farmers and farm workers, entrepreneurs and the marginalised sections deserve better. India cannot afford to continue down this path, he said, adding, “I urge the government to put aside vendetta politics, and reach out to all sane voices and thinking minds, to steer our economy out of this man-made crisis.” Singh said it is particularly distressing that the manufacturing sector’s growth is tottering at 0.6 per cent.
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“This makes it very clear that our economy has not yet recovered from man-made blunders of demonetisation and a hastily implemented GST,” he said. The former PM alleged that institutions are under attack and their autonomy is being eroded.
On government taking ~1.76 trillion from the RBI reserves, Singh said the resilience of the RBI will be tested after this record transfer to the government. This, he said, “claims that it does not have a plan on what it will do with this windfall”.
Noting that domestic demand is depressed and consumption growth is at an 18-month low and nominal GDP growth is at a 15-year low, he said: “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 doldrums. These are not the foundations for economic recover”. He blamed the government’s policies for massive jobless growth, saying over 350,000 jobs have been lost in the automobile sector alone.