Issue Brief on ” The Deteriorating State of the Indian Economy”

On September 27, senior BJP leader and former Finance Minister Yashwant Sinha severely criticized the economic policies of the ruling BJP government in a newspaper article, singling out current Finance Minister Arun Jaitley for blame for the deteriorating state of the Indian economy.[1] Sinha was not the first BJP leader to criticize the policies of his own party. Just some days before, Subramanian Swamy had also expressed concern that India was moving towards a major depression.[2]

Not surprisingly, the Congress has also focused on the effects of recent policies such as demonetization and the Goods and Services Tax (GST). Recently, for instance, former Finance Minister, P. Chidambaram had also written an equally scathing review of the Indian economy.[3] In fact, the Congress has for some time been focusing on the deteriorating Indian economy.[4] However, Sinha’s warnings that “the economy is on a downward spiral, is poised for a hard landing” have further energized the BJP’s political opponents, as coming from him the same critique seems more credible since it is not politically motivated.[5]

Read More