Referring to the June-quarter GDP growth data that shows India’s economic growth rate at a six-year low of 5 percent, noted economist and former prime minister Dr Manmohan Singh has suggested that the Union government should free itself of the denial mode.
He has further said that acknowledging the crisis in the economy needs to be the first step that Modi government should take. The Congress leader is also of the view that the BJP-led NDA government should move beyond the habit of managing the headlines.
“Instead of announcing sector-wise packages, the government needs to take steps to take forward the overall framework of the economy. The government should listen to all stakeholders with an open mind,” said Dr Singh in an interview to Hindi newspaper Dainik Bhaskar.
Further, the renowned economist has suggested five measures to help the economy recover:
- Rationalise goods and service tax, even if it results in a shortfall in revenue for the short term.
- Look for new ideas to revive rural consumption and the agriculture sector. “The Congress party in its manifesto (2019 Lok Sabha elections) has some key suggestions that could free up the farm sector and increase income,” he said,
- Take steps to ease the liquidity crunch in order to boost lending activity. He pointed out that not only public sector banks, non-banking financial companies also face cases of fraud.
- Focus on reviving sectors that generate employment opportunities such as textile, auto, electronics and affordable housing.
- Identify new export markets in the wake of the ongoing US-China trade war. Addressing the cyclical and structural issues could bring India back to high GDP growth rate in the next three to four years.
Patting the Congress-led governments for helping the country sail through the economic crisis in 1991 and 2008 inspite of not having the numbers that Modi currently enjoys, Dr Singh lashed out at the Modi-led dispensation over its demonetisation and “faulty implementation of GST” decisions. He added that demonetisation killed millions of jobs and destroyed small businesses, which rely on cash and are part of the informal economic framework.