How well are we going to rise of this fall? Subramanian Swamy waves $5 trillion 'New India' dream off as GDP slips to 5%

Mumbai, August 31: Waking ahead in the economic slowdown, in a major boom to the Indian economy, the Gross Domestic Product has turned down to be six year lowest, standing at 5 per cent in the first quarter of the financial year 2019-20.

 

The said GDP predictions are after the Finance Minister Nirmala Sitharaman on Friday announced the PSB mergers and declared to infuse required amount of capital in the organisations.

 

 

In a bid to tackle the slowing economic growth, the government has within a span of one week announced a slew of steps, from waving off higher taxes on the foreign investors to recapitalising state-run banks.

 

Earlier this month, the Reserve Bank of India while cutting the repo rate by 35 basis points also lowered its real GDP projection for the current financial year to 6.9 per cent, from 7 per cent. It further expected the GDP at 5.8 to 6.6 per cent in the first half of 2019-20, and 7.3-7.5 per cent in the second, seeing the consumer inflation remaining inside its target range over a 12 month horizon.

 

Meanwhile, Bharatiya Janata Party leader Subramanian Swamy said that the country may not reach its target of being a $5-trillion economy if no new economic policy is forthcoming. “Neither boldness alone or knowledge alone can save the economy from a crash,” Swamy tweeted. “It needs both. Today we have neither", he added.  

 

The measures announced so far indicate that the government is taking steps to mitigate the difficulties faced by the economy but these measures will play out only in the medium-term.

 

There being no quick fix solution to the downturn which has been in the making for past few years, the recovery will also take its own time but government and hasten the recovery by implementing the announced measures quickly and adding few more which could address both cyclical and structural issues.