Many signs indicate that the Indian economy is under grave stress, affecting nearly all sectors. “India’s economy is in a deep mess,” due to initiatives such as demonetization and GST, some lawmakers say, as they urge the government to handle the situation “which is intensifying on a daily basis.”
India is facing an economic slowdown not seen in 70 years, Rajiv Kumar, the vice-chairman of Indian policy think tank Niti Aayog, explained at the Hero Mindmine summit last week. The current liquidity crisis has forced businesses to survive on cash since lenders have stopped funding them, he described. “Within the private sector nobody is ready to lend, everyone is sitting on cash.” The vice-chairman was quoted by local media as saying:
This is an unprecedented situation for the government of India. In the last 70 years nobody had faced this sort of situation where the entire financial system is under threat and nobody is trusting anybody else.
Randeep Surjewala, a spokesperson for the Congress political party (Congress), concurs that this is India’s worst liquidity crisis in 70 years, calling for the government to take immediate action. Parliament Member and Congress leader Rahul Gandhi said Friday that the “Government’s own economic advisors have finally acknowledged what we cautioned for long – India’s economy is in a deep mess.”
Every Sector Is Suffering
Parliament Member and Congress spokesperson Manish Tewari held a press briefing Friday regarding the financial downturn. The former Union Minister commended Niti Aayog’s vice chairman for admitting that the current stress in the financial sector is unprecedented. However, he added that Kumar’s statement requires a slight amendment,