Economy Moved From Recession To Crisis Mode, Actual Fiscal Deficit Beyond 8%: Congress

The Opposition Congress on Saturday slammed the Narendra Modi government over the prevailing economic crisis in the country and claimed that the fiscal deficit is not at 3.3 per cent but beyond 8 per cent. Senior Congress leader Anand Sharma said that the economy has moved from recession to crisis mode and yet Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman are "oblivious" to the situation.

"Our sympathies are with the country that we have a finance minister who is clueless and does not understand the 'e' of economy or the 'f' of finance. Instead of addressing the grim situation confronting the Indian economy, she is blatantly allowing either patronage, promotion of crony-capitalism, huge tax cuts to richest people, no relief to poor," Sharma said while addressing a press conference at the Congress office in Delhi.

Referring to the contraction in India's factory output by 1.1 per cent in August, Sharma said that the production in the country has crashed, demand has collapsed and huge number of lay-offs and retrenchment are happening.

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"Manufacturing has hit a five year low...manufacturing should have been in a positive double digit growth. This country can ill-afford any fall in manufacturing because it is directly related to factory production and job losses. Large numbers of factories are shutting down," he said.

The former Commerce and Industry minister also accused the government of monumental mismanagement of the economy and claimed that the actualy fiscal difict is beyond 8 per cent.

"The fiscal deficit is not 3.3 per cent but beyond 8 per cent. I am referring to the very precarious situation in the Indian economy, which has moved from recession to a crisis mode," he added.

Interestingly, a minister in the Narendra Modi cabinet, Ravi Shankar Prasad, has today dismissed any slowdown in the country's economy. The minsiter cited the Rs 120 crore income by three movies on October 2, a national holiday, to support his claim.