Official data released on Friday brought fresh woes for the Government as the GDP dipped to a six-year low to 4.5% in July-September, 2019 quarter. The cut in GDP was 0.2 percent deeper than what news agency Reuters (4.7), and economists had expected.
As per the reports, the pace of economic growth fell below the 5% mark for the first time since the January-March period of 2013 when GDP grew at 4.3%.
This comes days after Finance Minister Nirmala Sitharaman accepted that there is a visible slowdown in the economy, however, “it’s not recession yet or it won’t be recession ever,” she said during a debate in Rajya Sabha on Wednesday.
As per economist, a crisis among shadow banks -a key source of funding for small businesses and consumers – weak rural spending and a global slowdown have been responsible for bringing down growth steadily.
To note, the government is taking several measures to push the economy back on track including, the privatization of Bharat Petroleum Corporation Limited, a mega-merger plan for the state-run lender and cutting corporate tax for manufacturing firms.
Although privatizing the public-owned firms is a move that has been criticized by economists as well as the opposition but the Government has no plan to rethink its strategy.
Economists claim that the Government’s move to privatize organizations that are already making a good profit needs revision.