FB   
 
Powered bysps
        Society for Policy Studies
 
 

 
Denial is no option
Posted:Oct 5, 2017
 
Print
Share
  
increase Font size decrease Font size
 
Prime Minister Narendra Modi has sought to project the GDP growth slump to 5.7 per cent during April-June as a one-quarter phenomenon. He projected critics of his government’s economic management as Cassandras spreading pessimism and despair. The fact is, however, that India has been experiencing a growth slowdown for not one but five successive quarters since January-March 2016. Moreover, this is happening at a time when global trade seems to be rebounding and many economies, advanced and emerging, are showing signs of a revival. And it’s not just April-June. Data collected by the Centre for Monitoring Indian Economy on new investment project proposals show these at Rs 84,500 crore for the just ended July-September quarter, which is the lowest since April-June 2014, which was when the Modi government had just taken over. On Wednesday, the Reserve Bank if India scaled down its estimate of growth for 2017-18 to 6.7 per cent, from the 7.3 per cent projection made only two months ago.
 
 
Simply put, there’s no more room for denial. The Modi government should accept the reality: The economy today is in the middle of a serious growth and investment slowdown that needs to be addressed. Key to this is restoring business confidence that has been dented due to flawed implementation of the GST, rendering prospects for the manufacturing sector uncertain in the near term. It is unwise in this scenario to paint everyone criticising the handling of the economy as a prophet of doom. What is needed is for the government to accept and recognise the slowdown and act on it. Having said that, it is welcome that the Prime Minister has signalled his government’s commitment to reversing some of the setbacks to growth. Especially encouraging is the PM’s attempt to allay the concerns of traders, his assurance that the government will not get down to retrospective scrutiny of their records and his welcoming of the migration of those from the informal to the formal sector, coming as it does days after former Finance Minister
 
 
Yashwant Sinha had written in this newspaper that raid raj had become the order of the day. It must be hoped that the Modi government will now put into action some of the correctives, starting with the GST and the pile of bad loans on the books of Indian banks. Over the next couple of months, this government is going to be severely tested. This is especially so with the upcoming contraction of the balance sheets by both the US Federal Reserve and the European Central Bank, and the risk of outflows. The government has so far wisely resisted calls for a fiscal boost to the economy. Now is the time for it to show that on the economy it means business.
 
 
 
 
 
Print
Share
  
increase Font size decrease Font size
 

Disclaimer: South Asia Monitor does not accept responsibility for the views or ideology expressed in any article, signed or unsigned, which appears on its site. What it does accept is responsibility for giving it a chance to appear and enter the public discourse.
Comments (Total Comments 0) Post Comments Post Comment
Review
 
 
 
 
spotlight image Since Prime Minister Sheikh Hasina assumed office again in Bangladesh in 2009, bilateral relations between New Delhi and Dhaka have been on a steady upward trajectory.
 
read-more
  Nearly 58 per cent of the about 600,000 Rohingya refugees in Bangladesh are children who suffer from severe malnutrition, a UN report released said.
 
read-more
A unique and passionate gathering of acrophiles, or mountain lovers, took place in neat and picturesque Aizawl, the capital of Mizoram state in north-eastern India in September.
 
read-more
India’s foreign policy under Prime Minister Narendra Modi has attained a level of maturity which allows it to assert itself in an effective manner. This is aimed at protecting the country’s national interests in a sustained way.
 
read-more
With over 100 incidents of braid chopping reported in different parts of Kashmir, there is widespread fear and anger among the people.
 
read-more
According to the National Bureau of Statistics, China's GDP expanded 6.9 percent year on year in the first three quarters of 2017, an increase of 0.2 percent above that of the corresponding period of last year.
 
read-more
As political roller coasters go, there is none as steep and unpredictable as the one shared by the United States and Iran.
 
read-more
In West Asia, the end of one war paves the way for the next. Raqqa, the Syrian capital of the self-styled Islamic State (IS), has fallen to a coalition of rebels, the Syrian Democratic Forces that is backed by the United States.
 
read-more
On “Defining Our Relationship with India for the Next Century”
 
read-more
Column-image

Title: The People Next Door -The Curious History of India-Pakistan Relations; Author: T.C.A. Raghavan; Publisher: HarperCollins ; Pages: 361; Price: Rs 699

 
Column-image

Could the North Korean nuclear issue which is giving the world an anxious time due to presence of hotheads on each side, the invasion of Iraq and its toxic fallout, and above all, the arms race in the teeming but impoverished South Asian subcon...

 
Column-image

Title: A Bonsai Tree; Author: Narendra Luther; Publisher: Niyogi Books; Pages: 227 Many books have been written on India's partition but here is a firsthand account of the horror by a migrant from what is now Pakistan, who ...

 
Column-image

As talk of war and violence -- all that Mahatma Gandhi stood against -- gains prominence across the world, a Gandhian scholar has urged that the teachings of the apostle of non-violence be taken to the classroom.

 
Column-image

Interview with Hudson Institute’s Aparna Pande, whose book From Chanakya to Modi: Evolution of India’s Foreign Policy, was released on June 17.

 
Subscribe to our newsletter
Archive