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Resource centre on India's rural distress
 
 

It's DeMo effect, says Singh

-The Telegraph

New Delhi: Former Prime Minister Manmohan Singh today directly linked the slowdown in growth to demonetisation, pointed out that private investments had almost dried up and expressed deep concern over a jobs crunch.

The most authoritative Opposition voice on the economy was speaking at the Congress Working Committee meeting, five months after describing demonetisation as "organised loot and legalised plunder" and warning that growth would be severely affected.

"India's GDP numbers for the fourth quarter and full year of 2016-17 were released a few days ago. Economic growth has slowed down sharply, driven primarily by the notebandi announcement of November 2016. Gross Value Added (GVA), a true sub-measure of economic activity, has also experienced a steep and sustained fall," Singh told the CWC.

"Private sector investment has collapsed and the economy is running on just one engine of public spending," he added, seeking to punch holes in the economic record of the Narendra Modi government.

According to the provisional estimates put out by the Central Statistics Office, real GDP growth had shrunk from 8 per cent in 2015-16 to 7.1 per cent in 2016-17.

Soon after the figures were made public, finance minister Arun Jaitley had tried to delink demonetisation and growth, blaming a cocktail of domestic and global factors.

Today, Singh said the most worrisome aspect was the impact of the slowdown on job creation.

"Jobs have been extremely hard to come by for the youth of the nation," he said. "The construction industry, which is one of the largest employment generators in the country, has suffered a contraction. This implies loss of millions of jobs for the nation's workplace."

Every speaker at the meeting talked about the adverse impact of demonetisation on the poor as well as on industry.

In her address, Sonia Gandhi referred to Singh's forecast in Rajya Sabha on the impact of the demonetisation on the economy and said: "The actual numbers show the scheme was a disaster."

"Till today, the government refuses to disclose how much of the demonetised currency in circulation was actually returned to the banks. It isn't that the Reserve Bank of India has forgotten how to count money."

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