Former finance minister P. Chidambaram took a dig at the Modi government on Friday after the latest data showed that retail inflation had reached a five month high at 4.87 per cent and the Index of Industrial Production (IIP) had slumped to a seven month low.
“Retail inflation hits 5-month high, industrial growth (IIP) slumps to 7-month low. Achhe Din is around the corner,” tweeted Mr. Chidambaram.
On Thursday, data released by the Central Statistical Organization (CSO) had shown that rate of retail inflation, based on consumer price index, had gone up to 4.87 per cent in May. Last time, retail inflation breached the five percent mark was in January when it touched 5.07 per cent. Six months before the high, in June 2017, retail inflation was merely 1.46 per cent.
While retail inflation went up, mainly on account of high fuel prices, the IIP hit a seven month low at 3.2 per cent in the month of May. A slump in IIP indicates sluggishness in the manufacturing sector that may have been triggered by weak demand.
Mr. Chidamabaram also referred to the Modi government's outgoing Chief Economic Advisor Arvind Subramanian's comment to The Hindu on demonetisation contributing to the deceleration of the economy.
“Outgoing CEA says demonetisation certainly contributed to deceleration of the economy. As we had predicted, it cost 1.5% of GDP,” said Mr Chidamabaram.