SME Times News Bureau | 02 Sep, 2019
Finance Minister Nirmala Sitharaman said on Monday the
government was in consultation with various sectors and would respond to the
situation as and when required.
"The government has been in consultation with several sectors. Because in
some sectors, the inventory is piling up... (There are) different issues for
different sectors. Having heard that and spent some time to see how best we can
respond, the first tranche of announcements was made on August 23,"
Sitharaman said here on Sunday.
As India's gross domestic product (GDP) growth rate fell to a six-year low of 5
per cent for the April-June quarter, apprehensions of slowdown have started
The Finance Minister who recently announced a slew of measures to retrieve the
situation, here on Sunday avoided a direct answer to a query whether the
economy was cooling.
"Last Friday, I made another set of announcements. I have also said, I
will come back again when the process of consultations are over, and we have
worked on or we can respond. So I will be coming back to respond to sectors,
which have come to us and which want some relief from us," she said.
Earlier, the Minister interacted with tax officials, traders, industrialists
and entrepreneurs in the city.
Concerns over cooling of economy resurfaced as slowdown in manufacturing pulled
the GDP growth rate in the first quarter down to 5 per cent, marking the fourth
successive quarter of decline. From 8 per cent in Q1FY19 to 5 per cent Q1FY20,
the GDP growth rate has fallen by 3 per cent in barely a year.
On the slide in auto sales, the Minister said the sector was facing problems
due to several factors, including transition from BS-IV to BS-VI emission norms
and prospective buyers were delaying their decision.
To help revive the auto sector, Sitharaman on August 23 had announced the
government departments would be allowed to buy new vehicles, automobiles
purchased till March 31, 2020 would avail the benefit of additional
depreciation of 15 per cent, with total depreciation up to 30 per cent, and
BS-IV vehicles bought till March 31, 2020 would remain operational for their
entire registration period.
On fears of job losses due to the recent announcement of merger of banks, she
said there won't be any retrenchment and the government was infusing capital
into the merged entities to strengthen the banking system.
On changes to the goods and services tax (GST) rates, Sitharaman said it would
be decided by the GST Council.
She said the measures announced in the July budget were showing results on
ground and job creations by the informal sector, the main employment generator,
The recent phase of low demand across sectors and decline in manufacturing
activity have invited the government criticism from several quarters, along
with the political opposition.
Former Prime Minister Singh earlier in the day slammed the NDA government and
blamed its policies for the economic slowdown. "India has the potential to
grow at a much faster rate, but the all-round mismanagement by the Narenrda
Modi government has resulted in this slowdown," said Singh.
Calling the slowdown a "man-made crisis", Singh, an eminent
economist, primarily blamed the demonetisation and a "hastily implemented
GST" for the present state of economy.
Criticising the government, the former Prime Minister said, "I urge the
government to put aside vendetta politics and reach out to all sane voices and
thinking minds, to steer our economy out of this man-made crisis."
However, reacting to Singh's allegation of vendetta politics, Sitharaman said,
"Is Dr Singh saying 'instead of indulging in political vendetta they
should consult sane voices?' Has he said that? All right, thank you, I will
take his statement on it. That is my answer."