Niti Aayog Vice-Chairman Rajiv Kumar on Friday said the 10-year period from 2004 to 2014, presided over by former Prime Minister Manmohan Singh, was India’s “lost decade” in terms of economic reforms. The UPA government, during this period, had provided much impetus to equity and distributive justice, but neglected economic reforms. “It was a decade lost for economic reforms. The Manmohan Singh government forgot economic reforms,” Mr. Kumar said. Speaking on the ‘Future of Indian Economy’ at the 49th regional conference of the Indian Institute of Chartered Accountants, Southern India Regional Council, here, Mr. Kumar said: “India’s potential remained unexploited. India and China were on the same page in 1991, but after that, China accelerated its growth rate. It’s share in the world trade is 14% now, against India’s just 1.8%. The country had launched 1st generation reforms during P.V. Narasimha Rao’s period and 2nd generation reforms during Vajpayee’s period,, with focus on telecom, Fiscal Responsibility and Budget Management (FRBM) Act, value-added tax (VAT) and disinvestment. But the UPA regime did not pay much attention to reforms though the economy registered a growth rate of 7 to 8% during UPA-1.”
Mr. Rajiv Kumar said the UPA-II regime witnessed a period of “policy paralysis” and lost credibility. The bureaucrats were unable to take decisions due to fear of the CBI, the CAG and other agencies. The growth rate was just 5% when the UPA was voted out in 2014.
Explaining the third round of reforms under the Modi government, Mr. Kumar said the government has been focusing on four major factors — enhancing growth with employment, formalising the economy, social welfare and economy cleansing, and administrative efficiency with focus on governance.
On demonetisation
Defending demonetisation of high value currencies, Mr. Kumar said nearly ₹8,000 crore deposited in banks was seized, along with benami properties worth ₹6,000 crore. About 56 lakh new taxpayers were added; undisclosed income of ₹29,123 crore was detected; three lakh shell companies uncovered; and 2.1 lakh shell companies de-registered.
Noting that “dualism of organised and unorganised sectors are not good for the economy”, he said 98% of firms are in the unorganised sector employing less than 20 people.
Many small firms were not complying with the tax laws, he added.
