Union minister Nitin Gadkari on Sunday said the country’s economy was facing a challenge and that decisions related to it would have to be taken swiftly, News18 reported.
The remarks came at a time when the Centre has been facing criticism for an economic slowdown. India reported that its 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. The growth rate in April-June was 5%. Core sectors such as automobiles and manufacturing have also slowed down gradually due to weakened consumer demand and dearth of investments. Wholesale price inflation rose to 0.58% in November from 0.16% the month before.
“I called senior officials at my home and told them there are cases of around Rs 89,000 crore,” he said at an event in Nagpur, Maharashtra, in support of the Centre’s decision to introduce the amendments to the Citizenship Act. “I will not tell you what to do, I will only tell you that the economy of the country is going through a challenging situation. There is a shortage of liquidity and decisions have to be taken quickly.”
Earlier this month, former Chief Economic Adviser Arvind Subramanian described the country’s economic crisis as a “great slowdown” and said it is in the “intensive care due to structural and cyclical factors”. His remarks came the same week the Asian Development Bank slashed its projection for India’s economic growth in the ongoing financial year from 6.5% to 5.1%.
India’s economic slowdown has been predicted by most other agencies and world bodies. On November 26, American credit rating agency Fitch Ratings’ company India Ratings and Research revised its growth forecast for India in the 2019-’20 financial year to 5.6%. In October, the International Monetary Fund had lowered India’s projected growth in the current financial year to 6.1% but said it would rebound to 7% in the 2020-’21 financial year. The United Nations Conference on Trade and Development, in its September report, said the country’s economic growth was expected to slow down to just 6% in 2019 from 7.4% the previous year.
In August, credit rating agency Moody’s Investors Service had downgraded the country’s projected GDP growth rate to 6.2% for 2019-’20. In May, the government had released a report by the National Sample Survey Organisation, which showed that India’s unemployment rate rose to a 45-year high of 6.1% in 2017-’18. Another survey showed that the monthly per capita consumption expenditure has declined for the first time in 2017-’18 since the 1970s.
Meanwhile, Finance Minister Nirmala Sitharaman on December 13 had listed the steps the Centre had taken to boost the Indian economy. Sitharaman said her ministry was working on economic matters “wherever it is needed”, and claimed that the “results of some measures have started showing”.