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Jaitley lashes out at critics who ‘don’t see beyond their nose’

Critics miss the key point that after growing between 7% and 8% for three years, the economy was in a position to undertake the kind of structural reforms needed, he said.

india Updated: Oct 15, 2017 15:21 IST
Yashwant Raj
Yashwant Raj
Hindustan Times, Washington
Arun Jaitley in US,demonitisation,GST
Finance Minister Arun Jaitley (left) talks with IMF Managing Director Christine Lagarde at the World Bank and International Monetary Fund annual meeting in Washington, DC, on Saturday.(AFP)

Finance minister Arun Jaitley on Saturday lashed out at criticism of the continuing slowdown in the Indian economy, saying it’s coming from those who “normally don’t see beyond their nose” and are missing indicators of an impeding turnaround and those beset by “immaturity”, including some within the BJP.

Critics who were in the BJP “are for some reasons not very happy today, (but) not for any ideological reasons but for reasons that I have already expressed myself in India” and wouldn’t like to reprise, Jaitley said at an interaction with reporters without specifying who he meant.

The finance minister and the government of Prime Minister Narendra Modi have faced stinging criticism at home after the economy posted yet another quarter of declining growth, 5.7% in the last, from members of the party such as former finance minister Yashwant Sinha, Subramanian Swamy and even the RSS-affiliate Bharatiya Mazdoor Sangh.

Responding to a question about continuing attacks on the government’s record on growth, Jaitley said the criticism has come chiefly from two quarters. The Congress, first, which he said failed to carry out the kind of reforms this government has undertaken and had led the country to a “policy paralysis”. Those from the BJP, or those who were in the party earlier, were the second.

The “immaturity” of those reactions, the minister argued, was that they missed the key point that after growing between 7% and 8% for three years, the economy was in a position — there was enough confidence — to undertake the kind of structural reforms needed. “You can slip by a percentage point or so for a quarter or two and then you can pick up again.”

And that pick-up has started, which was being missed by those who “normally don’t see beyond their nose”, he contended.

He was responding to a question about continuing criticism, essentially on account of demonetisation in November 2016 and then the implementation of the unified Goods and Services Tax regime that have been blamed for the slowdown, including by world bodies such as the International Monetary Fund.

The minister said indicators of an impending turnout are plenty and include positive PMI (Purchasing Managers’ Index, a measure of the health of the economy) both in manufacturing and services.

He also pointed out that the core sector growth has picked up, the Index of Industrial Production is up and exports had a huge jump of 26%, adding, “these are all good signs”.

The minister faced questions about the impact of demonetisation and GST at most of his public interactions that included events at Harvard and Columbia school and events organised by business and trade bodies.

His replies were almost always the same: structural reforms of this magnitude do come at a cost. But that cost, a slowdown, is “transient” and it must not be allowed to define the narrative.

The finance minister also pushed back against criticism that the government has tended to be populist. Populism would have been to not touch demonetisation and allow cash-dominance to continue, and to allow the shadow economy to continue. “We struck a blow to that kind of economy, and that’s not populism”.

First Published: Oct 15, 2017 15:20 IST