India economy has recently shown signs of slowing down, and this has prompted political debates and discussions about the future of the country’s growth trajectory. Despite Prime Minister Narendra Modi’s optimistic portrayal of India’s economic progress, Congress has slammed the government, accusing it of misleading the public with exaggerated claims. The latest GDP data reveals that India GDP growth rate has slowed significantly,
casting doubt on the promises made by the ruling party.
India’s GDP Growth Rate: A Closer Look at the Latest Data
India GDP growth rate for the July-September quarter of this fiscal year (2024) has dipped to 5.4%, marking a near two-year low. This figure comes as a disappointment,
particularly when compared to the 8.1% growth recorded in the same quarter the previous year. What’s worse, the performance of key sectors like manufacturing and mining has been sluggish,
with exports also showing signs of weakening.
While India remains the fastest-growing large economy in the world, the slow down has raised concerns about the country’s economic health and its ability to maintain the momentum of growth. Even with a growth rate of 5.4%, India’s economy is still performing better than China,
whose GDP growth in the same period stood at 4.6%. But is that enough to justify the optimism surrounding India’s economic outlook?
Congress Slams Modi’s Economic Hype
Congress has wasted no time in attacking the government over the latest GDP data. Party leaders, including Jairam Ramesh, have accused Prime Minister Modi and his supporters of creating an inflated image of India’s economic progress, only for it to crumble when confronted with the real figures. Ramesh pointed out that despite the government’s claims, the India GDP growth rate has significantly underperformed,
even falling short of the most pessimistic predictions.
“Despite the much-hyped PLI scheme and ‘Make in India’ initiative, the manufacturing sector has seen a shocking slowdown,” Ramesh said. Manufacturing growth has slowed to a mere 2.2%, which is far below what was anticipated. On top of that,
exports have decelerated to just 2.8%, while imports have contracted by 2.9%. All these signs point to deeper issues within India’s domestic economy.
The Hype vs. The Reality: What’s Really Happening?
One of the key criticisms raised by Congress is the government’s over-reliance on rhetoric and marketing. The Modi administration has been quick to tout its flagship programs like “Make in India” and the Production Linked Incentive (PLI) scheme as catalysts for industrial growth. However, the latest GDP data tells a different story. These programs have failed to deliver the expected results,
particularly in sectors like manufacturing and exports.
When you look at the numbers, it becomes clear that there’s a significant gap between the government’s claims and the reality. The India GDP growth rate has dipped below expectations, and several critical sectors have underperformed. This raises the question:
Has the government’s focus on promoting the country as a global economic powerhouse been more about show than substance?
Why is the Economy Slowing Down? Key Factors to Consider
There are several reasons why India’s economy is facing a slowdown despite its growing reputation as an economic powerhouse.
- Weak Domestic Demand: Domestic consumption, which plays a crucial role in driving economic growth, is showing signs of fatigue. With inflationary pressures, high interest rates, and lower consumer confidence, spending has been sluggish, which is affecting economic activity across multiple sectors.
- Slowdown in Key Sectors: As already mentioned, manufacturing and mining have been underperforming. Manufacturing growth of just 2.2% is a major red flag, especially when the government has been heavily promoting the “Make in India” campaign to boost domestic production.
- Exports and Imports: India’s export growth has slowed to a mere 2.8%, and imports have contracted by 2.9%. This suggests that the global demand for Indian goods is weakening, and domestic consumption is not enough to offset the loss. The contraction in imports, while seemingly positive, also signals lower demand for raw materials and intermediate goods, pointing to a broader economic slowdown.
- Global Economic Conditions: Global factors such as rising oil prices, geopolitical tensions, and the aftermath of the COVID-19 pandemic continue to put pressure on economies worldwide, including India’s. These external factors are impacting India’s export performance and are contributing to the slowdown.
The Political War: Modi vs. Congress
The India GDP growth rate has become a major political talking point. Congress has consistently criticized the Modi government for failing to live up to its economic promises. The latest GDP data provides ammunition for this criticism. Congress has emphasized that,
despite the government’s attempts to “recalculate” past growth figures, the truth remains: the Modi administration has failed to achieve the levels of economic performance seen during Manmohan Singh’s tenure.
Jairam Ramesh has pointed out that the GDP growth rate under Modi is far worse than it was under Singh, even when accounting for any changes in the way economic growth is calculated.
This comparison has been a central theme in Congress’ critique of the current government’s economic record.
What’s Next for India’s Economy?
As India grapples with these economic challenges, questions about the future of the economy abound. Will the government take decisive action to address the slowdown, or will the growth story continue to stall?
While India remains the fastest-growing major economy, it is essential to focus on the structural reforms needed to sustain growth in the long term. This includes addressing issues like weak domestic demand, sluggish manufacturing, and a volatile global economy. The success of initiatives like PLI and “Make in India” depends on the government’s ability to overcome these challenges and create a more conducive environment for business and industry.
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Conclusion
The latest India GDP growth rate data serves as a wake-up call for the government and policymakers. The slowing economy, coupled with poor performance in key sectors,
underscores the reality that India’s economic growth is not as robust as previously claimed. Despite the government’s rhetoric,
the economic reality paints a different picture—one that requires urgent attention and action.
While India’s economy remains the fastest-growing in the world, the current slowdown raises serious questions about its future trajectory. For India to maintain its growth momentum
it will need to address the structural weaknesses in its economy and ensure that its growth strategies are more than just promises.
