Government playing down current crisis, says industry lobby

November 26th, 2008 - 7:48 pm ICT by IANS  

Kolkata, Nov 26 (IANS) The government is trying to play down the current economic crisis as there seems to be a gap between its perception and other knowledgeable observers’ thinking on what would be India’s economic growth rate this fiscal, an industry lobby said here Wednesday.”Lot of members brought out the inherent contradiction between what the government is saying the growth rate will be and what knowledgeable observers think it will be,” Federation of Indian Chambers of Commerce and Industry (FICCI) president Rajeev Chandrasekhar told the media after a meeting of federation’s national executive committee here Wednesday.

“The government says the growth rate will be in the range of eight percent this year, whereas observers say it will be around six percent,” Chandrasekhar said.

“What is bothering the small, medium and unorganised sectors is that there seems to be a big gap between how Delhi is seeing the current economic crisis and how the rest of the country is seeing it,” he said.

He said the main concern is: where is the Indian economy heading towards?

Saying that there is no quick fix solution to this global economic crisis and its effect on the Indian economy, Chandrasekhar added: “There is a systemic solution that requires political consensus, bureaucratic and policy action, fiscal and monetary steps.”

All these measures are necessary to arrest the problem, he said.

“Since March this year, we have been saying that there is a brewing problem and even told the government that tightening of monetary policy to arrest inflation is an erroneous approach,” Chandrasekhar said.

“For arresting further slowdown of the economy, we now want the government to roll back the cash reserve ratio of banks to the level it was in 2004,” he said.

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