New delhi, Jan 15 (UNI) With the union Budget on the horizon, Congress leader Jairam Ramesh on Thursday mounted a sharp attack on the Modi government’s economic narrative, arguing that headline inflation-adjusted GDP growth figures are “deceptive” and mask deeper structural weaknesses, including stagnant incomes, weak consumer demand, and a worrying slowdown in private investment.
In a detailed post on social media platform X, Jairam Ramesh contended that the government’s portrayal of robust real GDP growth is inflated by unusually low price deflators. “The headline numbers for inflation-adjusted GDP growth rates are deceptive. The price deflators are themselves very low and hence these rates get magnified,” he said, cautioning against overconfidence based on such figures.
Ramesh argued that while low deflators may offer temporary cheer to the government, they are symptomatic of a more troubling reality. “Low price deflators are the result of low consumer demand on account of income levels which have stagnated outside the very top of the pyramid,” he said, pointing to widening inequalities in income and consumption.
Highlighting the contrast between corporate balance sheets and broader economic health, the Congress general secretary noted that Corporate India is currently flush with cash. “Profits are at record highs and debt at record lows,” he observed. However, he raised a critical question for policymakers: “Why are companies more focused on managing wealth in financial markets instead of making investments in capacity expansion?”
According to Ramesh, this reluctance to invest underscores the need for a strong push in the forthcoming union Budget. “The investment climate clearly needs a huge booster dose,” he said, adding that successive tax cuts announced by the government have failed to revive demand. “The slew of tax cuts have clearly failed to stimulate demand,” he remarked.
Taking his criticism beyond fiscal policy, Ramesh linked the investment slowdown to what he described as the political economy model of the Modi government. He warned against what he termed the “‘Hum Do Humaare Do’-isation of the economy,” alleging that market leaders are emerging through government patronage rather than innovation and competition.
Such a model, he argued, discourages private investment, especially when combined with what he described as an environment of “Fear, Deception, and Intimidation (FDI)” prevailing among the enterprise community. “This will only disincentivise growth in private investment,” Ramesh said.
The remarks come at a time when the government has been highlighting India’s position as one of the fastest-growing major economies, while opposition parties have questioned the quality and inclusiveness of that growth. With the Budget expected to lay out the government’s economic priorities for the coming year, Ramesh’s comments add to the intensifying debate over demand, investment, and the direction of India’s growth model.
