Modi accepts decline in growth rate, says govt committed to reversing fall
New Delhi: Acknowledging that economic growth had plummeted in the April-June quarter, Prime Minister Narendra Modi on Wednesday insisted that his government is committed to reversing the fall.
Modi’s statement comes amid the background of the Reserve Bank of India downgrading its growth forecast for the country from 7.3 per cent to 6.7 per cent. “After achieving average growth of 7.5 per cent over 3 years, we accept that growth rates came down April-June but government is committed to reverse it,” said Modi while addressing company secretaries at inauguration of Golden Jubilee Year of ICSI in Delhi.
India’s GDP has fallen to a three-year low of 5.7 per cent in the last quarter. Hitting out at critics, Modi said “During the six years of the previous government there were 8 instances when GDP was at or below 5.7. Dip in economic growth in one quarter has boosted pessimists; this is not the first time growth has dipped to 5.7 per cent in any quarter,” he said.
Flaying the Opposition, he said "Inflation was more than GDP growth during previous regime when high price rise, fiscal deficit and CAD made headlines". He defended his government saying that under the NDA regime double digit inflation came down to less than 3 percent, CAD was brought down to 2.5 percent, and fiscal deficit was reduced to 3.5 percent.
He went on to say that after demonetisation, the cash to GDP ratio came down to 9 percent, from 12 per cent in November 8, 2016.
Allaying the concerns of taxpayers, the Prime Minister said the government’s policies are aimed at “bettering the life or the poor and the middle class”. “Government very well understands the value of your hard earned money,” he said.
The sluggish growth in the economy has been attributed to the residual impact of the shock note ban in November 2016 and the teething troubles of the Goods and Services Tax reform.
On the hurdles faced by traders due to GST, Modi said he has asked the GST Council to review bottlenecks and technological hindrances in the implementation of the tax regime which completes 100 days in a few days. “The government is ready for changes to easy any bottlenecks in GST,” he said.
