Finance Minister Nirmala Sitharaman has said there is no question of India getting into stagflation or recession even as she claimed that the government has kept the retail inflation below 7% despite the pandemic, and the geo-political crisis.
During her reply on discussion on price rise in Lok Sabha, Sitharaman says, “Even as the global economic growth is being re-estimated and re-assessed, each time India remains at the highest. The GDP of the US fell 0.9% in the second quarter, following a 1.6% decline in the first quarter, marking the start of an unofficial recession as they call it. There is no question of India getting into recession or stagflation.”
“It is not just me, a Bloomberg survey has said there is zero probability of India slipping into recession even though several major economies are in substantially risky position of getting into recession,” the FM says.
Sitharaman enumerates the parameters establishing the stability of the Indian economy. She mentions about the healthy state of the Indian banks, high GST revenue collection, and sound PMI and core sector growth.
“4,000 banks in china are reportedly going to be bankrupt. In India, the gross NPAs of the scheduled commercial banks hit a six year low of 5.9% in 2022,” Sitharaman says.
Adding the national debt is an indicator of health of any economy, Sitharaman says, “The debt to GDP ratio in many countries are in triple digits and that includes japan Greece, Italy, Singapore, Bhutan, US, Portugal, Spain, France, Sri Lanka and Canada. The central government has very consciously controlled its debt at 56.29% of the GDP at the end of 2021 – 22, compared with 59.9% in the revised estimate for that year.”
“India is far ahead of its peers in context of the general government debt – centre state combined – as per the IMF data. The general debt to GDP ratio is 86.9%,” Sitharaman says.
On GST, the FM says the collection has remained above ₹1.4 lakh crore continuously for five months. “In July, this year, we have garnered the second highest GST collections at ₹1.49 lakh crore.
On the other parameters, Sitharaman says, “PMI is at eight-month high of 56.4 for July. Trend for new orders are strengthening.” Taking a dig at the Congress led United Progressive Alliance government, Sitharaman said that for a twenty months during the UPA, retail inflation was at 9% and in double digit for nine months. Sitharamn says India got into the fragile five nations during the UPA rule.
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