Accounts of seven years of hard work of Modi government

- Modi sinks Manmohan Singh's Harvard boat with hard work!

- The economy started collapsing with the ban on banknotes and non-implementation of GST, Corona was hit in the head

The government has released India's growth figures, showing that India's gross domestic product (GDP), or GDP, has shrunk by 4.5 per cent during the Corona epidemic fiscal year 2020-21. GDP is a measure of a country's economic growth. To understand this contraction in growth from a perspective, it must be remembered that India has grown at an average rate of 7% per annum since the early 1990s until the outbreak of the epidemic.

There are two ways to understand this contraction in GDP:

One way is that it should not be seen as a complete reflection - after all, India, like most countries in the world, is facing the Koro epidemic and wants to eradicate it.

The second way is to look at this contraction in the context of what has been happening to the Indian economy over the past decade, and more precisely in the last seven years, since the government led by Prime Minister Narendra Modi completed seven years of its rule last week.

In this context, the latest GDP figures do not show the whole situation. Instead, if one pays attention to some of the important statistical factors, it is that the Indian economy was in turmoil even before the Koro epidemic.

Prime Minister Narendra Modi initially joked that his hard work was weighing heavily on Manmohan Singh's knowledge of Harvard. What happens if Modi's hard work is audited after seven years?

Let's look at the most important issues in the current difficult situation ...

Gross Domestic Product (GDP)

Contrary to the expectations of the central government, the economy has contracted by 3%, which is the subject of growing weakness for more than 3 years in the 5 years of the Modi government. After the global recession in 2008, the Indian economy started recovering in 2013, the year before the change of power at the Center in 2014. However, the recovery slowed down from the third quarter of 2015-16 due to the unexpected note ban announced in November 2016. Experts say the ban is the beginning of a recession in the economy. The effects of the banknote ban, as well as the low level of preparation and haste, led to major difficulties in the implementation of the new Goods and Services Tax (GST) system in the country in July 2017. The Indian banking sector was already facing the problem of high bad loans. Due to the above factors, India's GDP growth slowed down from 5 per cent in FY17 to 5 per cent in FY2030, the year before the Corona epidemic. Thus the decline in the growth rate of the Indian economy had already begun.

GDP per capita

GDP per capita should be taken into account for how well an individual is in the economy. For this, GDP is divided by the total population of the country. Recently, India's per capita GDP has fallen below Rs 1 lakh to Rs 4,200, which was the same in 2015-16. Thus, India lags behind other countries in terms of per capita GDP. For example, in terms of per capita GDP, Bangladesh is ahead of India.

Dollar v / s Rupee

The exchange rate of the local currency against the US dollar is a strong measure of the relative strength of the economy. In 2016, the value of one dollar was Rs 6 in Indian currency, which has risen to Rs 7 in seven years. Weakness in the value of the rupee reflects the declining purchasing power of the Indian currency.

Fiscal deficit

The fiscal deficit reflects the economic viability of the government and tracks the amount that the government borrows from the market to meet its own expenses. Excessive borrowing usually has two disadvantages: first, government borrowing reduces the amount of investment available to private businesses, it also increases costs, and second, excessive borrowing increases the total debt that the government has to pay. At present, India's fiscal deficit is slightly above the target.

Inflation rate The central government has benefited a lot from cheap crude oil in the first three years of its rule, with crude oil hovering around ૧ 110 a barrel between 2011 and 2012. Was going down the barrel. On the one hand, the sharp fall in crude oil prices helped curb inflation and on the other hand, the government had the opportunity to stockpile crude oil. But since the end of 2014, India has been facing rising inflation. Even in the year 2020, despite the decline in demand due to the corona-induced lockdown, inflation has continued to rise. India is one of the unique countries - an advanced and emerging market economy where inflation has been above the Reserve Bank's limit since 2014. Inflation is a major concern for India in the near future. In view of the potential risks, the Reserve Bank has once again kept interest rates unchanged in recent lending policy.

Unemployment rate

India has done the worst on the job creation front. According to a government survey, the unemployment rate in the country was at an eight-year high in 2016-17, following the ban on banknotes and the implementation of GST. Then in 2014 it was reported that the number of working people has decreased by 3 million between 2014 and 2015, which is the first time in the history of independent India that the number of working people has decreased. Unemployment in India has risen from 7-8 per cent to 6-7 per cent, and the Koro epidemic has exacerbated the situation. The problem of unemployment is becoming more serious day by day in a country where millions of people lost their jobs during the Koro crisis and the creation of new jobs is declining sharply.

Now what is the vision for the future growth rate?

The biggest driving force in the growth of the Indian economy is private consumption by the common man. This demand for goods is about 5% of GDP. Private consumption spending is currently at its lowest level since 2014. That means people have reduced private consumption costs. If the government does not support it, India's GDP growth will not be able to get out of the cycle created by the crisis. For this reason recent GDP data should not be considered to reflect the overall state of the economy.

India's growth rate shrinks by 2.5 per cent in corona epidemic year, per capita income also falls

Manmohan Singh does not know how to make tea, Modi does not know how to run the economy!

After seven years of Modi government, there was a lot of humor on social media. Many people said that Modiji makes good tea, while Manmohan Singh does not know how to make tea. Tea is the drink of the poor. How could Manmohan Singh, who studied at a foreign university like Oxford and Cambridge, know such a simple thing? Many said trains were stopped for their tea at the Vadnagar railway station. Manmohan Singh does not like such a common thing. Is it any wonder that Modi doesn't talk about Harvard like economy? He is a man of hard work. Manmohan Singh saved the country from the 2008 global recession. In the 19th century too, he revolutionized India's economy by implementing LPG. Many sarcastically said that even though Modi knows how to make good tea, he does not know how to run the economy. Manmohan Singh filled the petrol tank in the car of the economy and gave it to Modiji to run. Modiji emptied the tank in seven years. Even when the country was not hit by the Corona, the economy was derailed. It would have been better if Korona had come, otherwise the big question would have been who would blame Modi Saheb for the dire state of the economy. In fact, it was Manmohan Singh who should have set up such a mechanism that even in Corona, Modi Saheb would not mind getting out of it. It is not Modi's fault, it is Manmohan Singh's fault that he did not set up such a system!