July 1, 2020
Tottering Indian Economy in Abyss
Syed Rifaquat Ali
The Bharatiya Janta Party (BJP) at the Centre, bereft of economists, is finding it difficult to cope with the economic crisis which got aggravated by Covid-19 pandemic.
"Worst economy in forty two years needs honest look," says Andy Mukherjee of The EconomicTimes. The Indian economy was already limping before the pandemic arrived in India.
And needless to point out that Coronavirus worsened it beyond comprehension. There are 529K confirmed cases of Coronavirus in India till date (June 28) and 16095 people have died, though it could be double of it since the government is suppressing a realistic figure.
The Capital (New Delhi) itself has accounted for 77000 confirmed cases of Covid-19 (till June 29) and the pandemic is showing no sign to abate. BBC has reported that "Lax contact tracing, excessive bureaucracy, poor or no coordination with private health services and political wrangles have all led to a surge in numbers." Andy Mukherjee rightly says that "India's economy hasn't been this bad in 42 years.
Pulling it back from the abyss will require more honesty than imagination."
The Economic Times has been pretty scathing about the Indian economy in its June 28,2020 edition: " The Indian economy had already been weakened by years of mismanagement before the crisis (Coronavirus) struck."
Dr. Subramanian Swamy, who taught economics in Harvard University sometime back, has been very candid and forthright when he told The Indian Express editorial director, Prabhu Chawla, " Prime Minister Narendra Modi doesn't know any economics, and since the BJP government is bereft of any economist, the economy has gone worse during BJP rule."
The present finance minister, Nirmala Sitharaman, has no clue about macroeconomics, and former finance minister, Arun Jaitley, who died in office, did not know ABC of economics, says Swamy.
Writing in The Economic Times (June 26,2020), Mihir Sharma says "According to International Monetary Fund (IMF), India will be the large economy worst hit by the Covid-19 pandemic. The Fund now says that Indian GDP in the ongoing financial year, which began in March 2020, will contrast by 4.5 per cent. Just a few weeks ago, it had been predicting 2 per cent growth for the year."
Sharma is not mincing words when he writes emphatically "The IMF projection is by and large in line with estimates from international banks and other international organisations. Indian officials have been reticent about their own estimates.
This is not surprising India's economy has not contrasted since 1979. For the government, this is uncharted territory." If we analyse India's economy of the recent past and present status, the country's GDP in 2019 was $3.202 trillion which is far, far away from Modi's dream of ambitious $5 trillion.
India's GDP growth in 2017-18 was 7.0 per cent and in 2020 it has come down to 3.2 per cent which is cause for worry for the Central government.
The Asian Development Bank, which came into being on 19 December 1966 and has 68 members with headquarters in Mandaluyong, Philippines, has forecast that countries in Developing Asia will barely grow in 2020.
"The Indian economy is headed for trouble because of our last six years of inappropriate economic policies," says Dr. Subramanian Swamy.
Syed Rifaquat Ali is Sydney-based correspondent
The Journal of America Team:
Editor in chief:
Abdus Sattar Ghazali
Senior Editor:
Prof. Arthur Scott
Special Correspondent
Maryam Turab
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