Economy in bad shape: Manmohan

Former PM Manmohan Singh on Sunday said the state of the economy was "deeply worrying" and urged the government to put aside "vendetta politics" and reach out to sane voices and thinking minds to steer the economy out of this "man-made crisis". He said "all-round mismanagement" by the Modi government was responsible for the slowdown.

"The state of the economy today is deeply worrying. The last quarter's GDP growth rate of 5 pc signals that we are in the midst of a prolonged slowdown. India has the potential to grow at a much faster rate but all-round mismanagement by the Modi government has resulted in this slow down," he said in a statement.

"India cannot afford to continue down this path," he said, adding: "It is particularly distressing that the manufacturing sector's growth is tottering at 0.6 pc."

"This makes it very clear that our economy has not yet recovered from man-made blunders of demonetisation and a hastily implemented GST," he said. The former PM alleged that institutions are under attack and their autonomy is being eroded.

On government taking Rs 1.76 lakh crore from the RBI reserves, Singh said the resilience of the RBI will be tested after this record transfer to the government. This, he said, "claims that it does not have a plan on what it will do with this windfall".

Blaming the Modi government's policies for massive job-less growth, he said more than 3.5 lakh jobs have been lost in the automobile sector alone. There will similarly be large-scale job losses in the informal sector, hurting most vulnerable workers, he said.

He said rural India is in terrible shape as farmers are not receiving adequate prices and rural incomes have declined.

The low inflation rate that the Modi government likes to showcase comes at the cost of our farmers and their incomes, by inflicting misery on over 50 per cent of India's population, he alleged.