Stating that he was aware of the discourse around the economy, Prime Minister Narendra Modi said Friday that the country had seen such “ups and downs” and the economy has the potential to come out of the current situation. Modi said the economy was heading for disaster five years ago and his government brought about discipline and built a strong foundation for a $5-trillion economy.
“I am well aware about the discussions related to the economy. But, within those discussions, we have to remember that during the previous government, GDP growth in one quarter had fallen to 3.5%, CPI inflation had touched 9.4% and fiscal deficit had breached 5.6% of GDP. I do not want to get into the debate that why some people stayed quiet then. There were ups and downs in the economy earlier too. Our country has shown the capability to come out from such situations always and it has come out stronger. And, this time also, India will come out of this situation,” the Prime Minister said at a function organised by industry body Assocham to celebrate its centenary year.
India’s GDP growth has slowed to over a six-year low of 4.5 per cent in July-September, the second quarter of this financial year. Modi said the government has decriminalised many provisions of the Companies Act and that work is underway to bring in more provisions, adding that the government listens to industry, understands their needs and is sensitive to their suggestions. He also said that the government is working to eliminate the inverted duty structure (where taxes on inputs are more than the tax on output).
Modi said that no inappropriate decisions will be taken in case of genuine commercial decisions. “I want to assure banking and corporate world that we have been able to overcome weakness in the system to a large extent. And so they should now take bold decisions fearlessly, invest boldly and spend undauntedly…I want to assure no inappropriate action will be taken in case of genuine commercial decisions,” he said, adding that the interest of the labour force should also be taken care of.
The Prime Minister highlighted improvement of India’s position in World Bank’s Ease of Doing Business rankings from 142 to 63 among 190 nations in three years and noted that India is among the top 10 nations to have, in the last three years, made continuous improvement. “This hasn’t come without having to face anger and allegations from people. We have been told that we are corporate agents. But we are agents of 130 crore Indians,” he said.
The government has also undertaken reforms in the banking sector to make it more transparent and profitable, he said. “Owing to the steps taken by the government, today 13 banks are on the path of profit, out of which six banks are out of PCA (Prompt Corrective Action). We have also hastened the process of unification of the banks,” Modi said.
The Prime Minister said Rs 100 lakh crore will be spent in the coming years on building infrastructure and another Rs 25 lakh crore on rural economy and this, in turn, will help nearly double the size of the Indian economy to $5 trillion by 2024.
Modi said the time taken to register companies has been cut to few hours from months and better infrastructure has enabled the cut in the turnaround time at airports and ports. Dynamic changes have been made in the Goods and Services Tax (GST) on the suggestion of trade and industry, he said, adding that the government is “not afraid of any challenges”.