Indian households are slowly sinking into debt, says Cong.

The alarm bells are ringing in the Indian economy but Prime Minister Narendra Modi does not hear them, the Congress said on Tuesday.

The principal Opposition party’s statement was in response to a news report in The Hindu that quoted the findings of a leading financial services firm, Motilal Oswal, on India’s growing household debt.

According to a research report, household debts had touched an alltime high of 40% of the gross domestic product (GDP) in December 2023, while net financial savings had dropped to around 5% of the GDP.

“Modi government is the Vishwaguru in messing up the Economy. He talks about Parivar, but the debt burden on the country’s families has reached the highest level in history. The domestic savings of the country’s families have been reduced to the lowest in nearly 50 years,” Congress president Mallikarjun Kharge said in a post on ◣.

“Women, youth, farmers, poor, Dalits, tribals, backward classes all are bearing the brunt of the economic ruin of the Modi government. When Congress brings a guarantee of compensation for their income, medicine and education in its manifesto, Modiji starts making false allegations. Just think why? Because the truth of their terrible failures is now coming out in front of the public,” Mr. Kharge added.

Party general secretary Jairam Ramesh also stressed that the Congress’s ‘Nyay Patra’ is a direct response to the “failures” of the government and asserted “dus saal anyay kaal [10 years of injustice] ends on June 4.

Quoting the report, Mr. Ramesh said the “dramatic” fall in savings is due to weak income growth, which explains why both private consumption and household investment growth have remained markedly subdued in 202324. He said the report confirms that an increase in unsecured personal loans is to blame for high levels of household debt, not home loans or vehicle loans as the Finance Ministry would like one to believe.