Our worst fears have come true, sub-6 pc growth is catastrophe: P Chidambaram on GDP figures

"The slide in economy continues. Slow growth, low investment and no jobs. An explosive cocktail. Our worst fears have come true. Sub-6% growth is a catastrophe, " Former Finance Minister P Chidambaram tweeted.

P Chidambaram

Former Finance Minister P Chidambaram slammed the government on Thursday after India’s GDP growth during April-June slipped to 5.7 per cent, the lowest in three years of the Narendra Modi government. In a series of tweets, the senior Congress leader took a dig at the government saying the worst fear has come true: “The slide in economy continues. Slow growth, low investment and no jobs. An explosive cocktail. Our worst fears have come true. Sub-6% growth is a catastrophe.”

He further said: “1% decline in GDP is a loss of Rs 1.5 lakh crore. 2% decline is a loss of Rs 3 lakh crore.” Chidambaram’s remarks come just hours after India’s GDP numbers were revealed. The GDP growth also lagged behind China’s for the second straight quarter as manufacturing slowed ahead of the GST launch and note ban impact lingered. As businesses destocked inventories ahead of the GST kick-off from July 1, gross value added (GVA) in manufacturing declined to a low of 1.2 per cent, from 10.7 per cent, year on year.

Meanwhile, expressing concern over the GDP numbers, Union Finance Minister Arun Jaitley said manufacturing growth rate seems to have bottomed out as GST has been implemented and destocking of pre-GST stocks is almost complete.

Finance Minister Arun Jaitley also admitted that the slump in GDP is a matter of concern. “Certainly a matter of concern that first quarter GDP has come down to 5.7 per cent and its obvious therefore throws up challenge for the economy,” said Jaitley adding that the GST could improve situation in future.