Hitting back at naysayers, Union Minister Arun Jaitley said on Monday that 7.7% growth in the March quarter has “firmly” established India as the fastest growing major economy and the future looks much brighter than the past.
He also dismissed former Finance Minister P. Chidambaram’s advice to cut tax on petrol and diesel by ₹25/litre as a “Trap suggestion”.
Mr. Jaitley said that with structural reforms like demonetisation, the implementation of the Goods and Services Tax and the enforcement of the Insolvency and Bankruptcy Code, India had two challenging quarters.
“Those who predicted a 2% decline in GDP growth have been conclusively proved wrong,” he said in a Facebook post. ‘The Economy and the Markets Reward Structural Reforms and Fiscal Prudence’
Former Prime Minister Manmohan Singh in November 2016 termed demonetisation as the Modi government’s “monumental mismanagement” which might shave off about 2 percentage points of GDP growth.
“The fourth quarter results of GDP data showed a phenomenal 7.7% growth rate and has established India firmly as the fastest growing global economy. This trend, according to experts, is likely to continue for the next few years,” Mr. Jaitley said.
He further said that double digit growth in the construction sector, record FDI, manufacturing expansion and financial inclusion schemes have created jobs and opportunities for self employment.
“A distinguished predecessor of mine feared that he may have to live his future in poverty. We have enabled every Indian to be a part of the world’s fastest growing economy. The future looks much brighter than the past. This trend is likely to continue for some years,” he said.
Former Finance Minister Yashwant Sinha had last year criticised Mr. Jaitley over the “mess the Finance Minister has made of the economy” and went on to slam the government over decisions like note ban and the GST, the new universal tax regime.
“The Prime Minister claims that he has seen poverty from close quarters. His Finance Minister [Mr. Jaitley] is working over-time to make sure that all Indians also see it from equally close quarters,” Mr. Sinha had said.
Mr. Jaitley held the finance portfolio before he underwent a kidney transplant surgery on May 14. He is currently recuperating and is now a Cabinet Minister without portfolio. Meanwhile, Railway and Coal Minister Piyush Goyal has been given the additional charge of the Finance Ministry.
Mr. Chidambaram too had said that the BJP government pushed people into poverty and the number of people below poverty line has gone up than what was during the UPA regime.
Mr. Jaitley said demonetisation, GST, digitisation, Aadhaar and the anti-black money measures are leading to gradual formalisation of Indian economy.
If the trend of tax collection continues over the next few years, Mr. Jaitley said “wWe are looking for a better future.
Without naming Mr. Chidambaram, Mr. Jaitley noted that his “distinguished predecessor” had himself “never endeavoured” to cut taxes on petrol and diesel by ₹25 per litre.
“This is a ‘Trap’ suggestion. It is intended to push India into an unmanageable debt — something which the UPA government left as its legacy,” Mr. Jaitley said.
The NDA government, he said, has established a very strong reputation of fiscal prudence and macro-economic responsible behaviour.
He added, “We must remember that the economy and the markets reward structural reforms, fiscal prudence, and macro-economic stability.
“They punish fiscal indiscipline and irresponsibility. The transformation from UPA’s ‘policy paralysis’ to the NDA’s ‘fastest growing economy’ conclusively demonstrates this,” he said.
