We Accept Growth Rate Declined, But We Will Reverse it: PM Modi

PM Modi hit back at critics, saying “we needed to recognise people spreading pessimism all around”.

Prime Minister Narendra Modi.

(Photo Courtesy: PMO/Screenshot)

Prime Minister Narendra Modi, who has maintained a stony silence in light of criticism of the economy from the Opposition, as well as RSS chief Mohan Bhagwat, addressed the nation on Wednesday evening to give a point-by-point rebuttal.

Conceding that growth rates had dipped in the April-June quarter, the PM said his government is working on reversing it. He added that the RBI has predicted a 7.7 percent growth in the coming quarters.

On Economic Growth

Hitting out at critics of the government and the previous UPA regime, Modi said:

Dip in economic growth in one quarter has boosted pessimists. There are some people who sleep well only after they spread a feeling of pessimism all around. We need to recognise such people... This is not the first time growth has dipped to 5.7 percent in any quarter. GDP growth dipped to 5.7 percent, or below eight times during the UPA regime, when nation was faced with high inflation, CAD and fiscal deficit.

Clarifying that the situation is better under his government, Modi said:

“The fundamentals of Indian economy are strong and the reform process will continue keeping financial stability in mind,” he added.

On GST

Speaking of ironing out creases in the new Goods and Services Tax, Modi said he has asked the GST council to review bottlenecks and technological hindrances in the new tax regime.

On Demonetisation

Modi also added that after demonetisation, the cash to GDP ratio has come down to 9 percent. Prior to note ban it was 12 percent, he said. “This is the time of a big transformation, the importance of honest and transparent governance is being realized,” he added.

The Modi government has been receiving criticism from several quarters for its bold economic policies like demonetisation and the new Goods and Services Tax regime.

In a column published in The Indian Express, former finance minister Yashwant Sinha wrote that he would be “failing his national duty” if he didn’t speak of the “mess” made of the economy by incumbent Finance Minister Arun Jaitley.

Also Read: Yashwant ko Gussa Kyun Aaya? Numbers Do Not Look Good For Economy

RSS chief Mohan Bhagwat too cautioned the government on the economy. In his annual Dussehra speech, while Bhagwat praised demonetisation and GST, he also raised concerns about how these policies were implemented, and their impact on the economy.