NEW DELHI: Indian economy is resilient and there is no cause for apprehension on decline in GDP with a slew of steps directed at boosting it, Union Minister Rao Inderjit Singh said on Thursday.
"The economy grew only at 4.5 per cent in the second quarter of this year. It is also true that in the past five or six years this is the lowest growth of the GDP. But I would also suggest that this is not a cause for apprehension and there are precedents before this in various years when the economy has gone down even further than 4.5 per cent but it bounced back," Statistics and Programme Implementation Minister Singh said in the Rajya Sabha.
Replying to a supplementary during Question Hour in the Upper House Singh said: "The Indian economy is resilient as such and I don't think there is any cause for apprehension".
In reply to another supplementary, he said the demand and supply system is not as good as it should have been.
"Farming is one sector where the economy has been suffering but I would just like to say that the International Monetary Fund and other multilateral organisations continue to underline a positive outlook on the Indian economy and I am sure that the economy in the coming months and years would improve," he said.
The minister said the government has been undertaking various measures to boost GDP growth.
Introduction of Insolvency and Bankruptcy Code (IBC) in 2016 is directed towards strengthening the financial system of the country, he said and added, implementation of Goods and Services Tax in 2017 is an important measure for rationalisation of tax structure and improving ease of doing business.
He also said that continuous liberalisation has led to an increase in inflows of foreign direct investment into the country.
In addition, the government has cut the corporate tax rate from 30 per cent to 22 per cent to boost investment activity, he added.
Stating that the corporate tax rate for new domestic manufacturing companies has been cut to 15 per cent - which is amongst the lowest in the world, he said the Reserve Bank of India has reduced the repo rate by 135 basis points during 2019 and it also mandates banks to link their lending rates with external benchmarks for reducing the cost of capital for investors.
"Government has approved a realty fund worth Rs 25,000 crore for stalled housing projects. Government has also extended PM Kisan scheme to include all farmers, which will boost rural consumption. To boost exports, Government has undertaken number of measures, inter-alia, extending the scheme of reimbursement of taxes and duties for export promotion replacing Merchandise Exports from India Scheme (MEIS) to incentivize exporters, fully automated electronic refund for Input Tax Credits in GST and revised priority sector lending norms for exports credit," he said.
The minister said the Union budget 2019-20 provides a push to infrastructure development with the intention to invest Rs 100 lakh crore in infrastructure over the next five years and also by restructuring National Highway Programme.
Scheme of Fund for Upgradation and Regeneration of Traditional Industries (SFURTI) has been started to facilitate cluster based development to make the traditional industries more productive, profitable and capable for generating sustained employment opportunities, he added.