Former Prime Minister Manmohan Singh on Friday said he was deeply worried about the current state of the Indian economy, Mint reported. His comments came just hours after latest government figures showed that Gross Domestic Product had contracted to 4.5% in the July-September quarter – the slowest growth rate in more than six years, and the sixth straight quarter of slowdown.
“We need to change current climate in our society from one of fear to one of confidence for our economy to start growing at 8% per annum,” Hindustan Times quoted Singh as saying. “State of economy is a reflection of state of its society. Our social fabric of trust and confidence is now torn and ruptured.” The prime minister made the remarks in the valedictory address of the national conclave on economy organised by the New Delhi-based Rajiv Gandhi Institute for Contemporary Studies.
According to the latest figures, the agriculture sector grew 2.1% in the second quarter, compared to 2% in the one before, while growth in mining contracted from 2.7% to 0.1%. Manufacturing contracted 1% compared to a 0.6% growth in the first quarter. Electricity and other public utilities grew 3.6% as against 8.6% in the April-June quarter. The output of eight core industries last month declined 5.8% compared to October 2018.
On Tuesday, Union Finance Minister Nirmala Sitharaman told the Rajya Sabha that though economic growth might have slowed down, a recession would never occur. Sitharaman said India’s real economic growth rate was 6.4% between 2009 and 2014, but 7.5% in the subsequent five years.
However, Manmohan Singh did not seem reassured. “There is no one today that can deny the sharp slowdown in India’s economy and its disastrous consequences, particularly for farmers, youth and the poor,” said the former prime minister. “But it is my belief that mere changes in economic policy alone will not help revive the economy.”
The prime minister had made similar points in an opinion article published in The Hindu last week. He reiterated that “no amount of subterfuge” could “hide the performance and analysis of a $3 trillion market economy of 1.2 billion people”.
In May, the government had released a report by the National Sample Survey Organisation that showed that India’s unemployment rate rose to a 45-year high of 6.1% in 2017-’18. A recent survey showed that the monthly per capita consumption expenditure has declined for the first time in 2017-’18 since the 1970s.