Taking potshots at the Narendra Modi-led central government, Congress leader Rahul Gandhi Friday said “India’s economy is in a deep mess” and asked the government to remonetise the economy by “returning the money to the needy and not the greedy”.
“Govt’s own economic advisors have finally acknowledged what we cautioned for long – India’s economy is in a deep mess. Now, accept our solution and remonetise the economy, by putting money back in the hands of the needy & not the greedy,” Gandhi tweeted.
Gandhi’s comments came after Niti Aayog Vice-Chairman Rajiv Kumar acknowledged that the government is faced with an “unprecedented issue” and that it needs to take steps that are “out of the ordinary”. He also said that the prevalent slowdown in the country’s economy is due to the distrust amongst the private sector where the credit situation is stagnant.
“This is an unprecedented issue for the government of India. For the last 70 years, we have not faced this kind of a liquidity situation. (The) entire financial sector is up in a churn and nobody is trusting anybody else… You may have to take steps that are out of the ordinary… I think the government must do whatever it can to take away some of the apprehensions of the private sector,” Kumar had said during a discussion at the Hero Mindmine Summit.
Stating that private investments will drive India out of the middle income trap, Kumar had also said some steps have already been announced in the Union Budget to address stress in the financial sector and give a push to economic growth, which hit a 5-year low of 6.8 per cent in 2018-19.
The growth rate for January-March 2019 showed a slip to 5.8 per cent compared to 8.1 per cent in the corresponding period last year. This is the lowest growth rate in 20 quarters and puts India behind China after almost two years. The rate was lower than this at 5.3 per cent in the last quarter of UPA II or January-March 2013-14.
For the entire year 2018-19, the economy is estimated to have slowed down to 6.8 per cent, lower than the original estimate of 7 per cent and 7.2 per cent recorded in 2017-18.