Economic Slowdown: 4.5% Growth “Clearly Unacceptable", "Worrisome", Says Ex-PM Manmohan Singh

Indian economy needs to grow at 8-9% per year to fulfil people’s aspirations. Root cause for slowdown is Modi government's distrust of businessmen, says Singh.

NEW DELHI—Former Prime Minister Manmohan Singh on Friday evening said that the drop of India’s economic growth from 5% to 4.5% in the second quarter of the current financial year, as revealed in the latest official figures, is “clearly unacceptable” and “worrisome”, and the “aspirations” of Indians require that the economy must grow “at 8-9% per annum”.  

The veteran economist and political leader was speaking at a national conclave on the Indian economy organised by the Congress-affiliated Rajiv Gandhi Institute of Contemporary Studies and Samruddha Bharat Foundation in New Delhi. 

Singh’s remarks came barely an hour after the Narendra Modi government announced the quarterly growth figures for the economy for the July-September quarter. The official data showed that India’s Gross Domestic Product grew at a six year low of just 4.5%. This number was 5% for the April-June quarter.

“There is no one today that can deny the sharp slowdown in India’s economy and its disastrous consequences, particularly for farmers, youth and the poor. The GDP figures released earlier today point that the growth rate of the economy in the second quarter of the current fiscal year is as low as 4.5% [sic.]. This is clearly unacceptable and the aspirations of our people want that this country should grow at 8-9% per annum. Therefore the sharp decline in growth rate from 5% in the first quarter to 4.5% in the second quarter is indeed worrisome,” he said. 

However, it wasn’t just the economy that he was concerned about. “The state of our economy is deeply worrying. But today, I will argue how the state of our society is even more worrying and that is a fundamental reason for the precarious state of our economy,”  he said. Adding further, “...it is my belief that mere changes in economic policy alone will not help revive the economy. We need to change the current climate in our society from one of fear to one of confidence for our economy to start growing robustly again.”

He also accused the Narendra Modi government, and the Prime Minister personally, of harbouring suspicion about businesses, calling it the “root cause” of India’s current economic malaise. Subsequently, he concluded his brief address by calling for the infusion of “trust” and “confidence” among businesses, workers and farmers.