A day after data released by the Central Statistics Office revealed that India’s industrial output had contracted by 1.1 per cent in August as against a growth of 4.2 per cent reported a month ago, the Congress on Saturday said the Indian economy is in deep crisis and accused the government of having no blueprint to arrest the slowdown.
Senior Congress leader Anand Sharma said the fiscal deficit would cross the 8 per cent mark if the unpaid bills of around Rs 10 lakh crore are taken in account.
“The government is hiding this. Unpaid bills are Rs 10 lakh crore. GST refunds which have not been made, refund to the exporters which has not been made, non-payment of bills by the government and PSUs — if you factor that in, the fiscal deficit is very high. The fiscal deficit is not 3.3 per cent, the fiscal deficit is beyond 8 per cent,” Sharma told reporters.
“The Indian economy has moved from recession to a crisis mode, and the Prime Minister and the Finance Minister are oblivious. After the big mandate the BJP received, it was expected that the Prime Minister will pay attention to the real issues that the country is confronted with, particularly the agrarian distress, the state of the economy, the crash in the production, collapse of demand and huge number of lay-offs and retrenchments.
“The data which was released by the Government yesterday is shocking. There is a 23.1 per cent fall in motor vehicles in the month of September. Gross fixed capital formation, which was hovering around zero for most of the time of this government, has now collapsed to (- 21 per cent) which is the lowest since the year 2012…” he said.
Sharma said India can ill-afford any fall in manufacturing “because it is directly related to factory production and job losses. Many factories are shutting down. Capacity utilization as per government’s claim is 73 or 74 per cent, which means 26 per cent is idle capacity…” he said.