India's gross domestic product (GDP) growth rate for Q4 has turned out to be worst at 3.1 per cent, said former Finance Minister P Chidambaram on Friday.
"We had forecast that GDP for Q4 will touch a new low at below 4 per cent. It has turned out to be worse at 3.1 per cent," Chidambaram, also Congress Rajya Sabha MP, tweeted.
The former Finance Minister in another tweet said: "Remember, this is pre-lockdown. Of the 91 days of Q4, lockdown applied only to 7 days. It is a telling commentary on the economic management of the BJP government."
AICC spokesperson Prof Gourav Vallabh said the cause of concerns are manufacturing at minus (-) 1.4 per cent clearly indicating that demand has collapsed in the economy. "Manufacturing growth for FY20 has been zero per cent, thus indicating complete failure of the Make In India programme," he said.
"Factory output (IIP) contracted by 16 per cent, thus indicating a significant pain in the MSME sector as well as the cause for high unemployment. Industry growth at minus (-) 0.6 per cent (Q4FY20) clearly indicates that pain continues on the unemployment front in Q4 of FY20. Services fall to 4.4 per cent (Q4FY20) from 5.7 per cent (Q3FY20). QoQ decline indicates that the country's strength has been dented significantly due to wrong policies," added he.
He further said: "The construction sector at -2.2 per cent clearly indicates high unemployment in the migrant labour segment pre COVID19. However, despite a continuous slide since the time the twin strikes of demonetisation and a faulty GST were imposed on the country's economy, the government has neither accepted the mistakes nor come with any concrete solution for the slide in the economy."
"Further, there is no indication of any action to spur demand and instead the government has started a course of pushing the entire country into deep debt through its faulty and lofty claims of a stimulus package to counter COVID-19. By the above numbers, it is clearly proven that even before the coronavirus cases started to surge in our country, the economy was struggling through a prolonged economic slowdown forced conversion into recession," said Prof Vallabh.
The AICC spokesperson said: "We demand who is to be held accountable for the continuous slide in the economy since the last four years? An explanation to the nation about the failure of the much-marketed 'Make In India' programme government should come ahead and accept the failure of demonetisation and faulty implementation of GST."
Commenting on the GDP data released by the Centre today, Dilip Chenoy, Secretary-General, FICCI, said: "GDP numbers released today are on expected lines. The data reflects the impact on the economic situation due to actions on account of COVID-19."
"Growth slipped to 3.1 per cent in the fourth quarter of 2019-20 and to 4.2 per cent for the full fiscal year 2019-20 and this is the lowest since 2008-09," added Chenoy.
The Indian economy grew by 3.1 per cent in January to March quarter (Q4 FY20) as COVID-19 pandemic further compressed consumer demand and private investments.
"In view of the global COVID-19 pandemic and consequent nationwide lockdown measures implemented since March 2020, the data flow from the economic entities has been impacted," said the Ministry of Statistics and Programme Implementation in a statement today.
"GDP at constant (2011-12) prices in Q4 of 2019-20 is estimated at Rs 38.04 lakh crore as against Rs 36.9 lakh crore in Q4 of 2018-19, showing a growth of 3.1 per cent," said the Ministry. For the full 2019-20 financial year, the headline number came at 4.2 per cent as against 6.1 per cent in 2018-19.
The COVID-19 led lockdown started in the last week of March and hence the Q4 GDP number does not reflect actual ground reality currently prevailing and its full impact on main sectors of the economy.
The resultant slowdown in household spending and corporate investment will emerge when the numbers for the current quarter (April to June) are collated to reflect actual distress in the economy.