New India (with a dwindling Economy)

New India (with a dwindling Economy) Wed, 22 Aug 2018

New India (with a dwindling Economy)

PM Modi led BJP government doesn’t shy away from claiming how they have ‘successfully’ boosted the economy. But the recent release of back series data on the GDP of economy has shattered most if not all such claims. GDP, gross domestic product, is one of the primary markers of a healthy economy. GDP growth reflects the nature of the economy at a given point of time. The recently released data clearly shows that not only did Congress led UPA government perform well in both their terms in comparison to NDA-I and NDA-II but also UPA is the only government in independent India’s history that delivered double digit growth in two separate years. BJP’s response to the same was calling it a draft series and not the final one. But the damage has been done and no amount of whataboutery can deviate from the fact that we managed the economy much better than Modi has done for all these years. 

Read this story in Hindi

Amidst the rupee reaching new an all-time low against the dollar, GDP figures and rising NPAs, new concerns are set to emerge in an already dwindling economy; one being the trade deficit which will have further implications on the Current Account Deficit (CAD). Trade deficit is the difference between value of imports and exports while CAD is the difference between the inflow and outflow of foreign exchange. The month of July saw the trade deficit widen to $18 billion, highest ever in over 5 years, from $16.6 billion in June. The fall in rupee is going to worsen the CAD which is expected to widen to 2.8% of GDP from the current 1.9%, according to a report by Japanese financial services major Nomura. 

The major concern was also highlighted by NITI Aayog vice-chairman Rajiv Kumar at an event organized by Confederation of Indian Industry (CII) where he said that he is more concerned about the trade deficit and has called for the government to push for exports. On the one hand the government is unable to manage the economy while on the other, BJP’s decision to cut down on corporate tax from 30% to 25% has reportedly benefitted only the top corporate players in the industry – friends of Mr. Modi. “This will benefit the entire class of micro, small and medium enterprises (MSMEs) which accounts for almost 99% of companies filing their tax returns,” was Arun Jaitley’s statement but just like all other promises, this failed too. 

BJP claims to be working towards a new India but the sad reality of this government is that they cannot even manage the current situation properly let alone ideate on improving the same. The economy has only worsened in the last 4 years which will have serious implications on the life of the common man if measures to manoeuvre the economy to the right path are not taken immediately. The only priority of the BJP government is to remain in power with whatever means but the BJP should know that not all ends justify the means.

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