Niti Aayog Vice-Chairman Rajiv Kumar today said the economic downturn which began in the last two years of the UPA II regime has bottomed out and growth will improve in the next two quarters.Kumar also admitted that there have been problems on account of demonetisation and Goods and Services Tax (GST) implementation but now people have adapted to the new tax regime.
”...this downward cycle of economic growth began in the last two years of the UPA II government and that downward cycle in my view has bottomed out.“We will be achieving higher growth in the next two quarters, and I think 2018-19 will be much better than the current year (in terms of economic growth),” he said at the AIMA diamond jubilee convention here.
India’s economic growth has slipped to a three-year low of 5.7 per cent in the first quarter of the current fiscal.The Niti Aayog Vice-Chairman also pointed out that in manufacturing and services PMI, the lowest point was reached in July from where it has started rising.
Kumar noted that historically countries that have adopted GST have all seen a decline in the growth rate because the system struggles to come to a new norm.“This formalisation of economy is going to take some cost,” he observed.
Applauding the Modi government’s performance, Kumar said India has attracted foreign direct investment (FDI) worth $250 billion in the last three years.He also said Indian industry must serve the national interest and not only the interest of some segments of society.
Kumar also emphasised on the need for creating trust between government and industry.Noting that Indian industry must embrace global cutting-edge technology, the Niti Aayog Vice-Chairman said one should think at the global level and not just for domestic consumers.
He also suggested that Niti Aayog work more with states.Earlier, speaking at the same event, Niti Aayog CEO Amitabh Kant said India cannot grow without gender parity as currently only 24 per cent of GDP comes from women.
Kant also said it is important to have consistency and predictability in government policies.