Former Finance Minister says India’s economy is in “deep crisis”
Yashwant Sinha slams Narendra Modi’s BJP government over failure to stimulate demand
A former Indian Finance Minister has described his country’s economy as being in a “very deep crisis” and accused the current Narendra Modi government of pretending otherwise.
Yashwant Sinha, a former senior member of Modi’s right-wing Hindu nationalist Bharatiya Janata Party (BJP), told the Times of India Litfest: "No matter what the powers that be say, the fact is that we are in a very deep crisis. This type of crisis takes a long time like three to four or even five years [to subside]. It cannot be resolved at the drop of a hat or by wielding a magic stick."
The largest concern for the veteran politician is the “death of demand” in the Indian economy. He said: “That is the starting point of the crisis. They [the government] are least bothered about what is happening to our farmers, people living in rural areas, now that is where the death of demand started from. The demand first dried up in agriculture and rural sector, then it dried up in the informal or unorganised sector, and ultimately it travelled to the corporate sector.
Official data on Friday found India’s second quarter GDP growth had fallen to 4.5 per cent, its lowest for more than six years. In his first budget following re-election, Modi forecast 2019-2020 growth of about 7 per cent .Investment in India for the second quarter of 2019 is down from 12 per cent a year previous to now only 1 per cent.
Sinha said the Modi’s government was not acting properly to prevent this slowdown and of not listening to his own warnings, made in 2017. He said: “This was something I had done after already warning them [government] personally through letters, personal meetings... it is only when the party's doors were closed on me that I had to start speaking publicly.”
Sinha left the BJP, India’s largest party in India, in 2018 and has since openly criticised Modi, even though his son remains a member of the cabinet. Sinha’s criticism has intensified and he said in his talk that under Modi, "democracy in India is in great danger”.
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