Hyderabad: Economist Mohan Guruswamy on 2 February launched a scathing attack on the Union Budget 2020-21, saying India is nowhere near becoming a five trillion economy. “To become a five trillion economy by 2024, your real GDP growth should be at least 14 per cent. But the Union budget reveals that we are nowhere near this figure,” said Mr Guruswamy, the former financial advisor to Union finance minister Yashwant Sinha under the Vajpayee government.
Speaking at the Guruswamy Centre in Secunderabad, the economist analysed various aspects of the budget and said the government is not in a position to declare that India will become a five trillion economy any time in the near future. Speaking about the real Gross Domestic Product (GDP) growth rate, he said, “In 2010, we were at our highest real GDP growth rate, which is close to 11.2 per cent. From 2010, we have been going down, and now we have reached a real GDP growth of three per cent this year, considering nominal GDP growth minus inflation. In fact, Manmohan Singh’s age was the golden age, considering the state of the economy right now.”
Referring to the ‘Thalinomics’ chapter of the budget, which refers to affordability of food in the country, the former economic advisor said ‘Thalinomics’ has shown that “vegetable prices have increased by 62 per cent in the country, which means that we all need to survive with just cereals in the years to come.”
‘Those who still live with their parents will benefit under new budget’
Talking about the need for savings and investments, and how citizens are reluctant to invest, Mr Guruswamy said, “Only those who are living with their parents, don’t have a home loan or claim other deductions will benefit under the new regime. Those who are living on rent and claim HRA, and deductions under 80C, 80D and so on might have to evaluate their actual savings before opting for a new one.”
“With an unemployment rate of 15 per cent we are looking at severe unemployment problem. While we add 12 million people to the workforce every year, we create jobs for only two million, while the remaining 10 million remains unemployed or underemployed,” he added.
Meanwhile, B.V Papa Rao, retired IAS officer and ex-advisor to the Chief Minister of Telangana, speaking about the Economic Survey of 2019-20 said, “The Economic Survey is three-fourths of our economic history. This is not a 12-month economic survey, but an economic history of three million years that does not address basic problems like unemployment in the country.”