GDP growth slumps to six-year low, Manmohan calls it worrisome

Nirmala Sitharaman, Narendra Modi
The pace of economic growth fell below the 5% mark for the first time since January-March period of 2013 when GDP grew at 4.3% | File Photo: PTI

India’s economy grew at its slowest pace in more than six years in July-September period, official data showed on Friday (November 29). The country’s Gross Domestic Product (GDP) grew 4.5% in the second quarter of current financial year compared with 5% in the previous quarter, and 7% in the July-September period of 2018.

The GDP data was worse than economists’ estimates. According to a poll conducted by news agency Reuters, economists had expected GDP growth at 4.7% in July-September. The pace of economic growth fell below the 5% mark for the first time since January-March period of 2013 when GDP grew at 4.3%.

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Reacting to the GDP growth rate, former prime minister Manmohan Singh stated that the country’s economy is deeply worrying. “The state of the economy is deeply worrying but I will argue how the state of our society is even more worrisome. The state of our economy is categorised as industries, agriculture, trade, jobs, monetary policy and fiscal policy. There is nobody who can deny the sharp decline in our economy. The mere change in economic policy will not help revive our economy,” said the senior Congress leader.

Congress chief spokesperson Randeep Surjewala alleged that for the BJP, the GDP was “Godse Divisive Politics”. He was referring to the ongoing row surrounding a BJP MP’s remarks on Mahatma Gandhi’s assassin Nathuram Godse.

“India’s GDP has collapsed to an abysmal 4.5%. We are in a virtual free-fall. This is the lowest GDP quarter in 6 years. But why is the BJP celebrating? Because their understanding of GDP (Godse Divisive Politics) suggests double-digit growth levels. All in the perspective (sic),” he said on Twitter.

Congress leader Jairam Ramesh too took a dig at the BJP-led government, saying the “slow down is real and deep.”

Friday’s data disappointed many economists who had pinned their hopes on the recently-concluded festive season for a pickup in demand.

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The government has exuded confidence that economic growth will pick up soon. It has over the past few months announced a series of measures to stimulate the economy, ranging from withdrawal of higher taxes on foreign investors, a mega merger plan for state-run lenders and a reduction in corporate taxes.

Finance minister Nirmala Sitharaman this week acknowledged the slowdown in the economy. “Growth may have come down, but it’s not recession yet or it won’t be recession ever,” she said during a debate in Rajya Sabha on Wednesday.