Indian economy losing steam, says Chidambaram

India is growing but the sequential quarter growth is declining and the economy is losing steam, said former Union finance minister P Chidambaram

New Delhi: Senior Congress leader and former Union finance minister P Chidambaram Saturday said India is growing but the sequential quarter growth is declining and the economy is “losing steam”. He also accused the Narendra Modi government of “neglecting” the poor and the very poor.

“The reality is we are growing but the quarter upon quarter growth or the sequential quarter growth is declining — 13.2 per cent, 6.3 per cent, 4.4 per cent and the fourth quarter, my estimate is, between 4.1 per cent and 4.3 per cent.

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“So, it is a declining quarterly growth rate, which means the Indian economy is losing steam,” Chidambaram said at the India Today Conclave.

Asked about India growing faster among the major economies of the world, the former finance minister said, “There is no boast in saying ‘I am the one-eyed monarch of the blind’. The point is China, when it grows at 3 per cent or 3.5 per cent, will still add every year to its annual wealth or annual output several times more than India growing at 7 per cent.” “China is five-and-a-half-times larger than India. Therefore, the relevant number is the per capita income and (according to) per capita income, we are still a very poor country, he said.

Chidambaram also said the BJP-led NDA government was wrong in not providing fiscal stimulus during the pandemic.

“The government was wrong in not giving a fiscal stimulus. That’s why three crore people had to migrate from other cities and states, back to Bihar and Uttar Pradesh,” he said.

Asked what would be the one thing he would credit the government with, Chidambaram said he would give credit to this government for its single-minded focus on containing the deficit and debt management.

“I have no hesitation in giving credit where it is due, but all I am pointing out is there is so much more to be done,” Chidambaram said.

“A prime minister with so much energy, drive and control over his party can do so much more. Instead of that, we are talking about a non-interview and documentary. Why are we wasting time on those things?” he posed.

Neelkanth Mishra, who is a member of the Economic Advisory Council to the Prime Minister, said what is extremely important right now is that in this global financial turbulence if India is seen as a stable economy, it will continue to attract foreign investors, foreign companies, which can bring skills and technology.

“So on a five-year basis, the expectations of India’s GDP growth should be that India will contribute 12-15 per cent of incremental GDP in the next five years,” he said.

Mishra also contended that the quarterly GDP numbers are extremely inaccurate.