Lowest GDP growth rate in six years: Manmohan Singh blames it on climate of fear by Modi government
Speaking at an event in Delhi, Dr Manmohan Singh tore into the government and said that the state of economy only reflects the state of society. Industrialists are not willing to invest, banks are not readily lending, and startups seemingly living under constant surveillance, due to a climate of mistrust, he said.
Linking the state of the economy to the current state of society, former Prime Minister Manmohan Singh said that a GDP growth rate of 4.5% is ‘really unacceptable’ and is against the aspirations of the country.
Numbers released on Friday show that the Gross Domestic Product (GDO) continues its downward spiral for the seventh consecutive quarter, falling to 4.5 per cent in the second quarter (July-September) of the year 2019-20. This is the lowest growth rate in a quarter in over six years.
According to Dr Singh, an internationally respected economist, mere changes in the economic policy won’t get India out of this slump.
He said that there is a palpable climate of fear in our society: the industrialists not willing to invest, banks not readily lending, and startups seemingly living under constant surveillance. This has led to an overall shrinking of purchasing power.
“Social factors are stifling the economy and the state of economy only reflects the state of society,” he said.
“From 5% GDP growth to 4.5% is worrisome and this government must stop seeing industrialists, banks, startups through a tainted prism of distrust and suspicion. Only then the economy can grow. Mutual trust and an environment of confidence are things which can foster economic growth.”
In his valedictory address at the National Economic Conclave, organised by Rajiv Gandhi Institute for contemporary studies, Dr Singh expressed deep worry regarding how the Modi Govt is not working towards eliminating this environment where businesses are not scared to invest.
“Many industrialists tell me that they’re scared of harassment by government authorities, bankers live in fear of retribution, and entrepreneurs hesitate to put up fresh projects for fear of failure.”
“No one can deny the sharp slowdown in the economy, and if the government keeps suspecting and distrusting the businesses and citizens, then it is very hard to recover”, said Dr Singh.
But on a note of optimism, Dr Singh said that with the majority mandate and the low global crude oil prices, this government has a once-in-a-generation opportunity to catapult India into an economic superpower. But to achieve that, the Modi government must instil self-confidence and exuberance, he said.
“I urge the Prime Minister to set aside his deep-rooted suspicion of the society and revive the animal spirits of our economy”, said Dr Singh as concluding request.