Govt seems ‘pessimistic about economy’: Congress’s Chidambaram on Economic Survey
The Government has projected India’s real GDP growth for the year 2019-20 at 7 per cent on the back of anticipated pickup in the growth of investment and consumption.Updated: May 28, 2020, 10:31 IST
In an attack on the Economic Survey released by the government on Thursday, senior Congress leader and former finance minister P Chidambaram said that the government seems to be ‘pessimistic about the economy’
“It appears to me that the government, speaking through the Economic Survey, is pessimistic about the economy,” he said soon after Finance Minister Nirmala Sitharaman tabled the survey in Parliament, a day before the union Budget.
“The Economic Survey 2018-19 is the first of the new government and the first under the new Finance Minister, Ms Nirmala Sitharaman. The first sentence of Volume-1, Chapter 01 is self-congratulatory (“During the last five years, India’s economy has performed well.”). I looked for the Outlook for 2019-20. It is in Volume-2, Chapter 01, but there is only a bland statement that “growth of the economy expected to be 7 per cent in 2019-20,” the former finance minister said in a statement.
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Chidambaram added that there were no growth projections sector wise. “The closest in terms of describing the outlook for 2019-20 can be found in Volume-2, Chapter 02. The Economic Survey flags (1) slowing growth, (2) shortfall in revenue, (3) finding resources without compromising the fiscal deficit target, (4) impact of oil prices on the current account and (5) recommendations of the Fifteenth FC on central government finances. I am afraid, none of these is positive or encouraging,” he added.
The Government has projected India’s real GDP growth for the year 2019-20 at 7 per cent on the back of anticipated pickup in the growth of investment and consumption. The survey states that the huge political mandate for the government augurs well for the prospects of high economic growth.
“The political stability in the country should push the animal spirits of the economy, while the higher capacity utilization and uptick in business expectations should increase investment activity,” said the Survey.
India continues to remain the fastest growing major economy in the world in 2018-19, despite a slight moderation in its GDP growth from 7.2 per cent in 2017-18 to 6.8 per cent in 2018-19. On the other hand, the world output growth declined from 3.8 per cent in 2017 to 3.6 per cent in 2018. The slowdown in the world economy and Emerging Market and Developing Economies (EMDEs) in 2018 followed the escalation of US China trade tensions, tighter credit policies in China, and financial tightening alongside the normalization of monetary policy in the larger advanced economies.