Statement Issued by Dr. Abhishek Manu Singhvi, MP & Spokesperson, AICC
“रुपया डूबा, अर्थवयवस्था लगा रही गोता है -मोदीजी! क्या ऐसे ही सबका विकास होता है?”
"भाजपा की दादागीरी का दौर दिखाई देता है - 'Tax Terrorism' का मौसम आदमखोर दिखाई देता है।"
“An inefficient government always replace the real issues with the virtual ones. To diverge the attention from its failures, the BJP has created a barrage of virtual issues for public sphere debates”
A. Ten failures of the government taking the economy towards a deadly slowdown:
1. The sales of the automobile industry
● According to the data released by the Society of Indian Automobile Manufacturers (SIAM), automobile sales fell 31% to 200,790 vehicles in July 2019 from 290,931 in July 2018. It was the worst sales performance since a 35% decline in December 2000.
● Sales declining in all automobile categories:
○ According to the Centre for Monitoring Indian Economy, car sales fell by 23.3% during April-June 2019 in comparison to the same period in 2018. This is the biggest contraction in quarterly sales since 2004.
○ Between April and June 2019, two-wheeler sales contracted by 11.7%. This is the biggest fall since October to December 2018, when two-wheeler sales had contracted by 14.8%, in the aftermath of the start of the financial crisis.
○ A good indicator of rural demand, tractor sales during April to June 2019, fell by 14.1%, the highest fall in nearly four years.
● The trend of the slowdown in the automobile industry did not come all of a sudden. The 31% fall in sales is also the ninth straight drop in monthly passenger vehicle sales. Sales have fallen in 12 of the 13 months since July 2018, underscoring the sharp slowdown in demand in the world’s fourth-largest automobile market.
● क्या इसी नींव पर भारत डबल डिजिट (Double Digit) ग्रोथ प्राप्त कर पाएगा?
● क्या इसी नींव पर भारत USD 5 ट्रिलियन (Trillion) की अर्थव्यवस्था बन पाएगा?
● ऑटोमोबिल सेक्टर की यह दुर्दशा पिछले कई महीनों से है, फिर जुलाई बजट में इस पर कोई ठोस कदम क्यों नहीं उठाये गए?
● अब अगस्त में क्यों प्रधानमंत्री जी और वित्त मंत्री जी इसका हल निकालने के लिए मिल रहे हैं?
● All the companies are potential victims of the slowdown:
○ In the month of July, Maruti’s sales plunged by 36.3%. Maruti sold 1.09 lakh units in July 2019, which is one of the lowest recorded numbers over the years.
○ Similarly, Hyundai, Mahindra and Mahindra, and Ashok Leyland reported a 10%, 15%, and 14% decline in sales, respectively in July.
● Around 280 car dealership in India has shut down in the past months, leading to a direct loss of 30000 jobs. There is a sudden fear of losing 1 lakh direct jobs in the sector in the coming months.
● At the same time, the vehicle loan growth has slowed down to 5.1%, the slowest it has been in five years.
2. Crashing Stock Exchange
● Indian stocks just suffered their worst July in 17 years as the disappointment with the Budget, muted corporate earnings, ongoing credit crunch, and consumption remained a drag on sentiment.
● The Indian equities declined, headed for their steepest fall for the month of July in 17 years.
● The BSE Sensex dipped around 5 percent, while BSE Midcap and Smallcap indices declined 8 percent and 11 percent, respectively. Nifty 50 has lost about 9.6%.
● 1 month after Budget, investors lost nearly Rs 13 lakh crore. The average market capitalisation of the BSE-listed companies fell from Rs 151.35 lakh crore on the Budget Day, July 5, to Rs 138.37 lakh crore on August 5, wiping out Rs 12.98 lakh crore.
● यह सब द्योतक है कि भारत सरकार की अर्थनीति पर आम आदमी को कितना हौसला है, कितना विश्वास है? ज़ाहिर है किविश्वसनीयता शुन्य है.
● A large part of the selling can be attributed to foreign institutional investors (FIIs), which have pulled out more than Rs 13,000 crore from Indian equity markets, while they were net buyers in the debt segment for over Rs 8,000 crore, Securities and Exchange Board of India (SEBI) data shows.
● More than 50 percent of the BSE500 stocks fell in double digits. As many as 283 stocks, or 56 percent of the names, have fallen 10-60 percent since the Budget day.
3. Rising Fiscal Deficit and deceiving figures:
● In a presentation to the 15th Finance Commission (FFC) on July 8, three days after the July 5 budget, the CAG re-calculated the fiscal deficit of 2017-18 to show that it actually works out to 5.85%. The government had reported a fiscal deficit of 3.46% that year.
● According to the Finance Commission, “Fiscal Transparency-Lack of underlying conceptual framework under-reporting of Deficit, revenue deficit, Quality of Capital Expenditure Asset accounting, etc” were discussed in CAG’s meeting with the Finance Commission. According to the Finance Commission, “the CAG highlighted the fiscal risks due to non-transparency.”
● According to a Financial Express research, Centre’s fiscal deficit for 2018-19 would have amounted to a discomfiting 6.1% of the gross domestic product (GDP) instead of the 3.4% reported.
● Pertinently, the Centre could meet the Revised Estimate (RE) for its fiscal deficit for 2018-19 only after a savage reduction in expenditure by Rs 1.46 lakh crore, or 5.9% from the Revised Estimates level, as tax receipts fell terribly short of the respective Revised Estimates.
● ये तो सीधा छल-कपट है; चोरी और ऊपर से सीनाज़ोरी है. एक प्रकार का विश्वासघात है.
● ये वैसी ही लुकाछुपी है जैसी आपने कुछ महीनो पहले रोज़गार और लेबर फाॅर्स के आंकड़ों के विषय में देखी थी. प्रकाशित होने से उनआंकड़ों को रोका गया था. प्रकाशन में विलम्ब किया गया था.
● The Central government plans to bring down the deficit to 3% repeatedly, the latest deadline to reach the target is 2020-21. It is nearly impossible to reduce the fiscal deficit from 6.1% to 3% in just less than two years.
● Contrary to the Central government, the States have proved to be the better performers. The states performed relatively better on the fiscal front last fiscal — their combined deficit for the year is seen to be around 2.6%.
● A major reason for the drastic increase in the fiscal deficit is the off-budget spending by the government. It reflects the unplanned nature and inefficient governance by the BJP.
● Off-budget spending by the Centre in 2018-19 includes Rs 1.06 lakh crore recapitalisation of public sector banks via bonds, Rs 97,000 crore borrowings by PFC for lending largely to the government-sector power projects, Rs 61,000 crore by NHAI for highways and Rs 52,297 crore by IRFC for railway projects.
4. Falling GDP figures
● India has slipped one notch in the World Bank’s Gross Domestic Product (GDP) rankings in 2018, and is now the seventh-largest economy with the United Kingdom and France ahead of India, data from the international lending institution said.
● The data comes at a time when India has set the target of becoming a $5 trillion economy in GDP terms by 2024, and a $3 trillion economy in the current financial year.
● Additionally, the GDP estimates for the January-March quarter of the financial year 2018-19 were recorded at 5.8 percent, government data showed. This happens to be the lowest growth rate in the past five financial years.
● This also means India is no longer the fastest-growing major economy in the world. China is ahead at 6.4 percent GDP in the March quarter. India's GDP estimate for the entire financial year 2018-19 was 6.8 percent.
● कितना भी सरकार GDP आंकड़ों का आधार बदल ले, कितना भी सरकार मिथ्या प्रचार करे, या विकृत करने का प्रयत्न करे, परसच्चाई छुपाना संभव नहीं. और यह दुखद सत्य है कि 6.5% GDP तो क्या, कहीं हम 6% पर हीं सिमित नहीं रह जायें.
5. Shrinking labour force
● Data from the latest labour force survey reveal that the total workforce reduced by 9.1 million people between 2011-12 and 2017-18. The number fell from 474 million to 465 million.
● Employment in agriculture fell by 26.7 million. Most of the unemployed individuals are women.
● Employment in manufacturing also fell in this period, by 3.5 million.
● अब आपको समाज आया की क्यों रोज़गार के आंकड़ें छुपाए जा रहे थे? अब आपको समझ आया कि क्यों National Statistical Commission के प्रमुख दो लोगों को इस्तीफा देना पड़ा था?
● These have to have a negative impact on aggregate demand, which would then have a more prolonged and severe impact through the negative multiplier effects of employment losses. These clearly require countervailing measures by the government.
6. Recession in the real estate sector
● The health of real estate is a massive indicator of the state of the Indian economy. It has links with about 250 ancillary industries -- bricks, cement, steel, furniture, electrical, paints, etc -- and affects them all if there is a boom or gloom in the sector.
● According to real estate consultancy Liases Foras, 12.76 lakh houses are waiting to be sold in 30 big cities.
● The inventory overhang is as high as 80 months in Kochi, 59 months in Jaipur, 55 months in Lucknow and 72 months in Chennai, implying it will take between five and seven years for developers in these cities to get rid of the present housing stock.
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