New Delhi: Former Prime Minister Dr Manmohan Singh on Friday termed the state of the economy as deeply worrying, while asserting that the state of society being even more "worrisome" is the fundamental reason behind the precarious condition of the economy.
"The state of our economy is deeply worrying but today, I will argue how the state of our society is even more worrisome and that is a fundamental reason for the precarious state of our economy," said while speaking at an event in Delhi.
The former prime minister termed the GDP figures released earlier in the day as unacceptable.
"GDP figures released today are as low as 4.5 percent. This is clearly unacceptable. Aspiration of our country is to grow at 8-9 percent per annum," he said.
The sharp decline in growth rate from 5 percent in Q1 to 4.5 percent in Q2 is worrisome. Mere changes in economic policies will not help revive the economy," said Dr Singh.
Singh also stressed that there is a "need to change the current climate in our society".
"We need to change the current climate in our society from one of fear to one of confidence for our economy to start growing at 8 percent per annum. The state of the economy is a reflection of the state of its society. Our social fabric of trust and confidence is now torn and ruptured," he said.
India's economic growth slowed to 4.5 percent in the July to September quarter from 7.1 percent in the corresponding period of 2018, the government data showed on Friday.
The economy had a weak performance last quarter with the GDP growth rate dropping to 5 percent.
The slowdown in Q2 FY20 was largely due to a sharp dip in the manufacturing sector and agriculture output said the Ministry of Statistics and Programme Implementation in a statement.
However, Chief Economic Advisor (CEA) KV Subramanian has expressed hope that the country's gross domestic product (GDP) is likely to pick up in the third quarter of the current financial.
"We are saying again that the fundamentals of the Indian economy continue to be strong. GDP is expected to pick in the quarter three," he said.
Department of Economic Affairs (DEA) Secretary Atanu Chakraborty said that equity capital flows have been positive this year.
Meanwhile, the eight-core industries recorded 5.8 percent decline in October from the 5.2 percent decline seen in September, said the government data.
"The combined index of eight core industries stood at 127 in October, 2019, which declined by 5.8 percent as compared to the index of October 2018. Its cumulative growth during April to October 2019-20 was 0.2 percent," according to an official statement by the Ministry of Commerce and Industry.
The index of eight core industries comprises coal, crude oil, natural gas, steel, cement, electricity, fertiliser, and refinery products. The index makes up 40.27 percent of the Index of Industrial Production (IIP).
Coal production declined by 17.6 percent in October versus the de-growth of 20.5 percent. The index was also dragged down by electricity which reported a plunge of 12.4 percent compared to a plunge of 3.7 percent in September.
Crude oil production declined by 5.1 percent in October 2019 over the same month of 2018. Cement production declined by 7.7 percent but fertiliser production increased by 11.8 percent. Petroleum refinery production too increased marginally by 0.4 percent.
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Updated Date: Nov 29, 2019 21:10:18 IST