On his first day after his 106-day Tihar jail stay, former Finance Minister P Chidambaram, on Thursday lamented at the declining Indian GDP, at his first press conference after being granted bail by the Supreme Court. Listing the falling GDP numbers, Chidamabaram listed that India has seen a steady fall in GDP numbers for the last six quarters from 8% to 4.5%. He reminded of former CEA Arvind Subramanian's claims of the Centre inflating the GDP numbers.
"Nothing sums up the state of the economy better than the following series of numbers: 8, 7, 6.6, 5.8, 5 and 4.5. Those are the quarterly growth rates of GDP in the last six quarters. The third and fourth quarters of 2019-20 are not likely to be any better. Please remember Dr Arvind Subramanian’s caution that 5 percent under this government, because of suspect methodology, is not really 5 percent but less by about 1.5 percent," said Chidambaram.
In the start of the press conference, he had stated that in relation to the INX media case, his conscience as a minister was clear as all his business colleagues and journalists have observed him. He added that he has total confidence that the Courts will, ultimately, render justice. The Supreme Court had ordered the former Union Minister to not give any interviews or public statements regarding the INX Media case while granting bail to him in the ED case of the INX media case.
This statement by the former Finance minister comes on the same day when the RBI cut its outlook on the real gross domestic product (GDP) for the current fiscal year 2019-20 to 5 %from 6.1%. Moreover, the Central Bank has projected growth in the second half of FY20 at 4.9-5.5 percent, and at 5.9-6.3% in the first half of FY21, as per reports. Furthermore, RBI has projected that inflation will higher than expected at 5.1% to 4.7%. It also did not change the repo rate (the rate at which it lends to banks), maintaining it at 5.15%, sending market indices to negative.
Earlier on November 29, India's second-quarter GDP (July-September) numbers stood at 4.5% - the slowest growth in almost seven years, as released by Central Statistics Office. The previous quarter (April-June) GDP numbers were at 5% and the Q2 (2018-2019) stood at 7%. This development comes inspite of the government's various economic moves like the merger of 9 PSU banks into 4, major corporate tax cuts, policy changes in the automobile sector, reduction in tax regulations to boost foreign income, attract investors and increase the consumer demand. The government currently follows the base year of 2011-12.