Saturday, 21 July, 2018

NDA govt restored the credibility of the economy: Arun Jaitley

India’s finance minister says a massive currency overhaul that disrupted commerce across the country late last year had little effect on an econom NDA govt restored the credibility of the economy: Arun Jaitley
Melissa Porter | 03 June, 2017, 01:28

"There was some slowdown visible even before demonetisation in the previous year". "It's a major challenge because it also impacts the capacity of the banking system to support growth". He added that the services sector particularly financial services, which had witnessed 910% growth -had slowed. The ability of banks itself was in question.

The opposition on Thursday attacked the Modi government over the decline in GDP growth during the last quarter in 2016-17, saying their fear of demonetisation impacting the economy had come true.

However, with economists and analysts blaming demonetisation move for almost 1% drop in India's growth, there is still hope. He asserted that 7-8% growth was "fairly reasonable" against the backdrop of the current global situation.

Refuting any negative impact of GST on the country's growth, Jaitley said, "I see no reason why there will be any adverse impact of GST".

"So the analogy between GST and Demonetisation is totally off". It is like a tax cut which will both reduce prices and increase consumption.

"This is for the government to ensure that their promise of implementing GST from July 1 is met", said Congress spokesperson Ajoy Kumar. So far we have succeeded in maintaining that consensus. The goods and services tax (GST), expected to be in place July 1, will help boost the economy, he said.

Jaitley said the criticism of jobless growth was a propaganda by opponents who had nothing substantial to comment on the government's performance.

Jobs aren't created outside the economic structure. "This is the faster growth they promised", Yechury said on social networks.

Saddled with $150 billion of sour debts, banks have been slow to grant loans, especially to businesses perceived as riskier.

CEA Subramaniam said even states have to do it under the FRL limit that it does not exceed 3% of the GDP. "This clarification, which has come, has nothing to do with the state legislations".

On the proposed privatisation of Air India, the Finance Minister said it was for the Civil Aviation Ministry to decide on the mechanism.

"Now they have to decide on how their divestment has to be taken up".

"It is for the Civil Aviation Ministry to explore various options", he added.

Addressing the media, the finance minister said the new federal taxation, which is now at the last stage of its implementation, will bring transparency, simplicity and efficiency in the tax administration. Its not with the Government.

On the Pradhan Mantri Garib Kalyan Yojana (PMGKY), Revenue Secretary Hasmukh Adhia said the response had not been good, with collections at only ₹5,000 crore. People found that 75% of the money being blocked. The Finance Minister said that the note ban had led to greater move towards digitisation of the Indian economy.