Finance Minister Arun Jaitley today said the 8 per cent GDP growth can be achieved next fiscal on account of improved rural demand and better monsoon, even as he urged the Opposition parties not to "play games" in Parliament when it comes to passage of bills to initiate key reforms.
Jaitley, who was speaking at a memorial lecture here, said, "Manufacturing has become flat but started picking up... if we have a better monsoon then rural demand will become higher which will have some impact on manufacturing, probably at the beginning of the year. We anticipate that a growth of 8 per cent is possible to achieve this year."
"Therefore, we will have to take steps to increase demand. And therefore the width of economic activity expands.
"It is extremely important for us to keep two factors in mind. One is to set the correct signals domestically and globally. (With) the roadmap which we have embarked upon we are capable of doing it. So whenever in the next session, important legislations like direct tax reforms, indirect tax reforms, bankruptcy laws they come up, they should see the light of the day."
The Finance Minister, who has been very critical of Opposition parties stalling the GST Bill, said, "Don't play games in Parliament. They eventually should realise that they are stalling the growth process of the country. What is the credibility of India? And therefore it is extremely important that these issues be resolved. India needs to speak largely in one voice."
On the global economic scenario, Jaitley said, "As we stand today in 2016, there is at least a much larger consensus as to what roadmap this country is to follow. There are a few significant changes. Compared to 1991, there is one unique change. The constituencies that support reform and change are even politically much larger than 1991."
"Therefore those who try to stall reforms - their figure itself is narrowing. And not only it is contracting, there is a lot of public outcry to the substance of obstruction," he said.
Jaitley further said there is a public opinion that reforms should not be stalled and need to be moved faster.
"This also can be seen from the fact that there is greater impatience and restlessness. What is happening in the rest of the world - India is repeatedly referred to as the fastest growing economy in the world.
Jaitley said now the world refers to India as the bright
spot. "But within the country, there are serious legitimate concerns. We are no longer satisfied to be viewed as a bright spot in the global scenario," he added.
"In 7-7.5 per cent growth in which we are in today, we are still below our potential. If we look before the next half decade, we still believe that our growth potential is much higher.
"Today if we look at our growth potential, what is driving the Indian economy, the Indian economy is being driven on three pillars - increased public investment, increased FDI and increased urban demand," the Finance Minister said.
India needs to initiate reforms to increase demand so that the width of economic activity expands, he added.
(REOPENS CAL8)
Jaitley said one of the greatest highlights to have
taken place in India is that most state governments have jumped in a greater way in wanting to get the very best for their own states.
"Partly because their aspirations are higher to fight regional inequalities. All states feel that they have a right to grow. The economic idiom in each state has changed, they are competing with neighbouring states to attract investment. This is an important situation," he said.
Referring to China, he said, "We are lesser impacted by the China slowdown as we are not in that supply chain. Maybe there is some impact on the stock markets."
On low oil and commodity prices, he said, "We have benefitted from the reduced oil and commodity prices. Savings from lower prices have helped in pumping money in the infrastructure sector."
He said there have been delays in passing legislations but none got rejected. "Hopefully, the legislations will get passed," Jaitley added.
The greatest benefit that growth can give is to provide resources for poverty alleviation. "Growth is the biggest antidote for fighting poverty," he said.
The Finance Minister said, "The current situation has a number of pitfalls. Can we turn it to our advantage? But at this point, I must say that the process which has been taken is irreversible."
Targetting the Opposition parties, he said the largest democracy like India cannot function if there is no "high quality of politics".
"Politics in India needs an evolution and there is a need to avoid policy diversion. Populism is an example of policy diversion," he said.
On the global economic turmoil, Jaitley said India has survived the crises of 2001, 2008 and 2015 on account of sound fundamentals.
