The current Indian economic growth rate of 5 per cent is not optimal and the country should aspire to grow at 10 per cent for a sustained period just as China did for about three decades, BJP Vice President and Spokesperson Baijayant Jay Panda has said. Indian economy, which till recently was hailed as the fastest-growing major economy, saw the growth rate drop to 5 per cent in April-June 2019 from 8 per cent recorded a year earlier. The Bharatiya Janata Party (BJP) leader emphasised that the Indian government led by Prime Minister Narendra Modi has been responsive and committed to getting the growth rate back on track.
"When we talk of the Indian economy in recent months, almost the entire discussion has been about the lowered GDP growth rate…When we talk about a 5 per cent growth rate, let us be very clear - it is not optimal, we should have no hesitation in acknowledging that India needs a much higher growth rate," Panda said during a special address at the Columbia Indian Economy Summit here on Friday. The summit was hosted by the Deepak and Neera Raj Center on Indian Economic Policies at Columbia University's School of International and Public Affairs in partnership with the Consulate General of India, New York.
"We definitely need to be planning to get back to at least the 8 per cent growth rate that we have had, even in the recent past. But if I had my druthers…we should really be aspiring to have a 10 per cent growth rate and for a sustained period, like China had for about three decades," he said.
Highlighting some of the major reforms undertaken by the Modi government, Panda said the single biggest economic reform that has happened not just in the last five years but in the history of independent India has been the Goods and Services Tax (GST).
"You could argue that it is not a perfect tax. I would argue that we had the options, because of the consensus that had to be built, of not having a GST (but) of having continued with a far more complex, many more taxes, much more paperwork that existed or to go ahead with having a GST though not ideal, (but one that) dramatically reduces the complexity and then you fix it as you go along, which is exactly what has happened over the past two years," he said.
The event was also attended by Director at the Raj Center and former NITI Aayog Vice Chairman Arvind Panagariya and professor and eminent economist Jagdish Bhagwati as well as other leading members of the academic and Indian-American community. Panda said the Indian economy today, despite its lowered growth rate, falls among the 30 per cent of global economies, which are in a better-off position.
"Over the last one year, ever since the Indian growth rate itself came down from 8.2 per cent to the present 5 per cent, the global scenario has been one of trade wars and (where) more than two-thirds of the world's economies are facing challenges far more severe than what we are experiencing," he said. Pands noted that in this environment, the World Bank has predicted that India will reach a GDP figure of USD 4.7 trillion by 2024, close to the aspirational target of 5 trillion dollars set by prime minister Modi.
Stressing that the biggest challenge of any economy has to be jobs, Panda said the same applies for India's economy. Referring to the Employees' Provident Fund Organisation data last month that India created 1.1 million jobs, he said the challenge was that this job creation cannot be a "flash in the pan" and that India needs to create more jobs month after month and year after year.
"And for that, yes, indeed, we do need to get the growth rate back up, as I've been talking about. And here, the government has been responsive by implementing several measures over the past few months," he said. On the government's August 5 decision to revoke Article 370 in Jammu and Kashmir, Panda said the move is "arguably the single toughest and biggest political decision that the Indian Parliament has taken in 72 years".
Panda said these tough decisions had been contemplated and decided on many times. The Indian Parliament had passed many resolutions, but it lacked political will and political capital. "And this is another example of an attempt to go to the roots of a problem rather than just to manage a crisis, rather than just to try to deal with the symptoms," he said.
"Now, this (revocation of Article 370) has had a lot of discussion around the world…There is so much disinformation that has been spread over decades that we recognise it's going to take time to get India's point of view acknowledged, understood and supported," he said. "When a narrative is out there of 'Indian Occupied Kashmir', it is important to understand that the only legitimate successor state to which Jammu and Kashmir can belong as per the rules that applied entirely throughout South Asia is India.
In fact, it was Pakistan, which illegally, without a shred of documentation or any of the rules of independence or partition supporting it, occupied Kashmir. Worse, in 1963 it gave away a part of that Kashmir to China," he said. "So you can actually legitimately talk about 'Pakistan-occupied Kashmir', you can legitimately talk about 'China occupied Kashmir'. And (for) this narrative to change is going to take time because we believe we are in the right so we haven't really bothered to put out India's point of view," he said.