Responding to the sharp decline in GDP estimates on Monday, the Congress has said the figures have just bust the myth of “green shoots”.
Addressing a press conference, former Finance Minister P Chidambaram said while the figures are hardly a surprise to anyone except those in the Government who have been predicting green shoots. The staggering decline, he said, should be a matter of “shame” to the Government which did “nothing, literally nothing” to arrest the decline.
“The CSO has released the provisional estimates of GDP for the quarter April-June 2020 (Q1 of 2020-21). GDP in the first quarter has declined by a whopping 23.9 per cent. That means, about one-quarter of the Gross Domestic Output as on 30-6-2019 has been wiped out in the last 12 months. Another way of looking at it is, since the end of 2019-20, the gross domestic output has fallen by about 20 per cent,” he said in a statement.
He pointed out that besides agriculture, forestry and fishing which grew at 3.4 per cent, every other sector has declined sharply.
‘Be grateful to god’
“The Finance Minister who blamed an ‘Act of God’ for the economic decline should be grateful to the farmers and the gods who blessed the farmers. Every other sector of the economy has declined sharply, some precipitously. Manufacturing is down 39.3 per cent; construction by 50.3 per cent; and trade, hotels, transport and communications by 47.0 per cent,” said Chidambaram.
Quoting the RBI Annual Report, he said the economic tragedy was foretold by many close observers of the Indian economy, most recently by the RBI in its Annual Report a few days ago.
“The estimates do not come as a surprise to us. They should be a matter of surprise to the government that was seeing ‘green shoots’ on several days during the first quarter. They should also be a matter of shame to the government that did nothing — literally nothing — to cushion the fall by taking suitable fiscal and welfare measures, but we know that the Modi government has no shame and will not acknowledge its mistakes,” he added.
He said the RBI report had pointed out that the contraction in the first half of 2020 is “deeper and more destructive than the Great Depression and the Global Financial Crisis (of 2008)”. It had also signalled a severe shock to consumption and pessimism related to general economic situation.
‘Plea unheeded’
“All these had been anticipated, we had warned the government and we had urged the government to take preventive and pre-emptive measures. Our pleas fell on deaf ears. The country, as a whole, is paying a heavy price, the poor and the vulnerable are in despair. It is only the Modi government that was nonchalant and uncaring. The government peddled a fake narrative, but that narrative has been exploded today by the CSO estimates,” he said.