A day before presentation of Economic Survey, former Prime Minister Manmohan Singh today painted a bleak picture of the Indian economy insisting "it is not in good shape" while he released a document detailing the current economic scenario in India.
The Bharatiya Janata Party (BJP), however, cited official statistics to counter the Congress' claim that the economy was not doing well.
Releasing the "Real State of Economy 2017", a document prepared by the Congress research cell at the party headquarters here, Singh said it speaks about the state of India's economy, its many issues and where it is heading.
"Indian economy is not in good shape is now obvious. The IMF has projected that the growth rate of India this current fiscal year will not be 7.6 per cent but 6.6 percent. Several other agencies have made similar projections," he said.
"I will not comment on those projections, it is for you assess what the truth is. This is a contribution to the ongoing debate on where are economy stands, where it is heading to and what is to be done to pull it in the right path," added Manmohan Singh.
Former Finance Minister P Chidambaram accused the government of "hiding behind" GDP numbers that are being challenged and said the state of the economy "is not something that we can be happy about."
Chidambaram expressed concern over the low credit growth which he claimed is at 5 per cent, the "lowest in several decades".
"BJP is hiding behind a GDP number which is being challenged. People are not dazzled by it, but are asking where are the jobs?
"NDA government tends to believe exaggerated version of economy, this research document is closer to truth than what government will say tomorrow," he said.
Chidambaram, addressing reporters at the AICC headquarters, said every government must be optimistic, but optimism must stem from a realistic assessment of situation.
"Yet, if government presents tomorrow a rosy picture of the economy, people of India are entitled to question that.
There are no jobs, capital formation is declining, credit growth is the lowest in several decades," he said.
Chidambaram wanted government to focus on fiscal consolidation and said, "there are serious question marks on this government's ability to follow fiscal prudence".
He dismissed suggestions that the 2008 farm loan waiver was a populist measure, saying, "It was based on the response to a demand from the farming community and was a very wise decision."
"This was especially so as the international financial crisis hit in September 2008, which crippled even major economies but did not affect India much," he said.
He claimed that while there are no jobs, new capital investment and no credit growth, the document released "candidly, truthfully" assesses the state of India's economy,
supported by hard research and data.
Hoping that government will not cut social sector spending, the former Finance Minister claimed that the MNREGS was the lone scheme that provided some succour to poor by way of jobs.
"There is a 60 per cent spurt in demand for MNREGS jobs. If they are cut, then it would be a very cruel cut. This demand is because of loss of jobs and. I sincerely hope that this government will not make this cardinal mistake of cutting expenditure," he said.
Congress spokesperson Rajiv Gowda said, "The slowdown in the Indian economy in the wake of demonetisation will last four to five years."
He told the government that it should not use the issue of universal basic income tax an excuse to attack social safety net.
The BJP cited official statistics to counter Congress’ claim, and called the party press meets, addressed by Manmohan and Chidambaram, a damp squib.
Union Ministers Piyush Goyal and Nirmala Sitharaman in a joint press briefing said that during the last two and a half years of the Narendra Modi government, the economy has improved on every parameter as compared to the Congress-led United Progressive Alliance's (UPA's) last three years.
BJP counters Congress claim
Citing official statistics, Goyal said that during the NDA rule, inflation has come down, current account deficit and fiscal deficit have narrowed, foreign exchange reserves have gone up and the GDP growth rate has been consistently above seven percent.
"The information given by the Congress, and no less than by a former Prime Minister and a former Finance Minister, lacked in facts," he said.
Goyal said that when the present government took over in 2014, India had come to be counted among the most fragile economies in the world, there was a policy paralysis and no foreign investments were coming.
"This government has ended policy paralysis, has brought in transparency and making policy-based decisions. As a result, huge investments have been attracted in infrastructure including roads and railways," he said.
Calling the Congress presser a "damp squib", Commerce and Industry Minister Nirmala Sitharaman said that the Congress was trying to deflect attention from the Mallya controversy.
"We can give you concrete data for whatever we are saying. Where is the Congress data for their claims? I think their allegations are not based on hard research but on their wishful thinking," she said.
Sitharaman said that the Congress leaders did not answer questions raised by the BJP earlier in the day vis-a-vis beleaguered businessman Vijay Mallya as to how could his companies get huge loans despite not fitting in the bill.
