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The fact that some people are blaming Nirmala Sitharaman instead of Arun Jaitley for slowdown shows that they know nothing about macroeconomics. While I myself don't like her as FM there is no way she is responsible for the GDP growth numbers.
The two main reasons behind the slowdown is the NBFC crisis which started after IL&FS went down due to fraud and the elections. The slowdown effect due to elections will go down as government starts spending and that will be seen in numbers for coming quarters.
The thing government needs to focus on is NBFC crisis. The refusal to bail out IL&FS and other NBFCs like DHFL has created a liquidity crunch in the economy. While I support the decision to not bail them out, government and RBI needs to ensure that enough liquidity is available
To be clear the Indian economy will grow even if the govt sits and does nothing. The responsibility of the government is to ensure that it grows at a rate that caters the growing population. For which a lot of measures needs to be taken. The next 5 years of the govt
will be judged on whether it succeeds to take up those measures or not. Main ones will be land and labor law reforms and whether it is able to kick start the manufacturing sector and reduce the people dependent on agriculture in the country.
While I believe that the $5 trillion dollar economy goal by 2024 is unattainable due to current slowdown and an impending recession. It is good that govt has set a steep target for itself. I hope it would lead to government taking reforms that will get the economy up & running
