A day after India lost the tag of ‘world’s fastest growing economy’ with the GDP growth slowing down to 6.1 per cent in the January-March quarter, Finance Minister Arun Jaitley on Thursday said that reforms introduced in the last three years have helped restoring the credibility of the Indian economy.
Speaking on the completion of three years of Modi government, Jaitley said that India was nowhere on the global radar when the present government came to power, adding that the Modi government inherited a “weak” economy.
“India was nowhere on the global radar three years ago. Three years ago, there was slowdown in policy reform and structural changes. Credibility was low, we inherited corruption and indecision,” he said.
Jaitley further rejected claims that the government’s demonetisation decision in November last year led to the fall in GDP numbers.
“There are several factors which affect GDP. Even before demonetisation, there was some slowdown. I do believe, that in the current global situation, a 7 to 8 per cent growth which is at the moment an Indian normal, is a reasonable growth. I don’t see any adverse impact of the GST”.
When asked about demonetisation and its impact, Jaitley said that it is aimed at removing the parallel or shadow barrier, adding that it had three distinct benefits.
“There were three distinct benefits from demonetisation. Firstly, there is greater movement towards digitisation, tax payers' base has increased and a message has gone loud and clear that it is no longer safe to deal in cash,” he said, adding that all these steps are towards 'Operation Clean Money'.
Jaitley said resolving NPAs and encouraging private sector investment are the major challenges before the government.
When asked about the increasing tensions with Pakistan, Jaitley said that his government had taken enough steps to ease tension but Pakistan had responded with cross-border terrorism to "successfully" prevent the atmosphere for peace talks.
"The steps intended to ease tension were responded to by a Pathankot or an Uri. The environment which must exist for talks has been successfully prevented by Pakistan," he said.
