Economic Clouds: Challenges Ahead for India's Growth

Congress General Secretary Jairam Ramesh warns of three major challenges facing India's economy: unsteady private sector investment, stagnation in manufacturing, and declining real wages. These issues could hinder India's future economic growth, overshadowing the optimistic claims by the current government.

Congress General Secretary Jairam Ramesh expressed concerns on Sunday regarding the economic outlook of India, citing three critical challenges that could constrain growth in the foreseeable future. He criticized Prime Minister Narendra Modi and the NDA government for exaggerated claims about the country's economic progress, pointing out significant chokepoints that threaten to stunt growth.

Ramesh highlighted the fluctuating momentum of private sector investment, the stagnation within India's manufacturing units, and the declining real wages and productivity of Indian laborers over the past decade as alarming indicators. He emphasized a notable 21% decrease in new project announcements within the private sector in financial years 2023 and 2024, attributing this decline to inconsistent government policies and a climate of regulatory 'raid raj.'

Furthermore, Ramesh criticized India's formal sector for prioritizing stock market valuations over revenue growth, predicting adverse implications for the country's long-term economic future. He also noted that since the inception of the 'Make in India' initiative, the core manufacturing sector has seen stasis in both GDP share and employment levels. He attributed the sluggish growth in exports to a disconnect between economic policy and global competitiveness.

(With inputs from agencies.)