Don’t spread pessimism on economy, says Modi

GROWTH SLOWDOWN ‘One quarter’s reading means little, GDP will bounce back’

I want to assure all, even our critics, that we don’t feel everything is wrong. But there is a need to guard against spreading negativity.

NARENDRA MODI, Prime Minister

NEW DELHI: Prime Minister Narendra Modi on Wednesday strongly defended his government’s management of the economy, pledging to reverse a downturn in economic growth.

Modi’s comments come at a time when the narrative about the economy has turned negative, triggered by the economy’s slowest expansion in three years during the three months ended 30 June, and fanned by criticism of his government by former finance minister Yashwant Sinha and former disinvestment minister Arun Shourie, both once leading lights of Modi’s own Bharatiya Janata Party (BJP).

The Prime Minister, in a talk at an event organised by the Institute of Company Secretar- ies of India, admitted that economic growth has slowed, but added his government is “commited to reversing the trend”.

During the course of an almost hour-long talk, Modi highlighted the country’s hard-won macroeconomic stability — it is no longer part of the so-called Fragile Five, or countries that stood to lose the most in 2013 from the US Federal Reserve’s decision to end its fiscal stimulus — listed his government’s reformist initiatives (87 reforms across 21 sectors), and pointed to recent data that shows the emergence of green shoots in the economy.

“While the PM has acknowledged the slowdown in recent quarters, he pointed out that macro parameters such as current account deficit, foreign exchange reserve and inflation are in the best shape ever,” said Sanjeev Sanyal, principal economic adviser, finance ministry.

Lashing out at his government’s critics, Modi said it was fair to criticise the government, but not to spread negativity.