Expressing concerns over India’s economic growth, former chief economic advisor Kaushik Basu stated that the country’s Gross Domestic Product (GDP) growth rate has slowed down due to distress in some sectors of the economy and the consequences of which could be far reaching. He added that this has resulted in a decrease in job creation and it is a cause for concern.
Basu highlighted that distress has been ‘very much visible in the agriculture sector’ as the ‘condition of farmers is bad’. According to the latest government data, the country’s economy grew at 7.1% in July-September, the lowest in three quarters. Noting that the slowdown may continue for six months to one year and its consequences could be far reaching, he said the government needs to pay attention to the condition of people in villages.
Former chief economic advisor said the agriculture sector is still feeling the effects of demonetisation, while other sectors had factored in the note ban to a large extent. He also said ‘Many farmers who had resorted to heavy borrowings in the December 2016-January 2017 period could not tide over the situation as yet. The distress in the agri sector is very much there’. Talking about farm loan waiver, he said it was needed in India because of ‘special circumstances’.
