NEW DELHI: The Indian economy has officially entered an economic slowdown zone, Aam Aadmi Party leader Raghav Chadha said on Wednesday.
“We have now officially entered economic slowdown. From falling GDP, massive job losses, to the automobile industry dangerously close to recession — the mess seems to be everywhere. But is the government willing to even acknowledge the problem?” Raghav said, adding that the slump is not just about numbers but “a felt reality”.
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The Indian economy grew 6.8 per cent in FY19, with the GDP expanding by 5.8 per cent in the quarter ended March, the slowest in five years.
Highlighting that 286 dealerships have been closed down in the past 18 months, he said the negative impact can be seen on tyre, steel, steering and manufacturing industries.
He said 15,000 people lost their jobs in the industry over the past three months and that Honda had laid off 700 workers at their manufacturing plant in Haryana. “As the automobile sector slows down, the ripple effect is felt across the automobile component industry.”
There are warning signs that if the situation persists, there will be job losses to the tune of 10 lakh in the automobile component manufacturers industry alone, the chartered accountant-turned-politician said.
As per the latest numbers, Chadha said, India’s top 30 cities had 1.28 million unsold housing units, witnessing a steep rise from March 2018 figures, revealing that “Indians are not buying houses at the pace at which they are built”.
“When real estate slows down, many other sectors such as steel, cement, furnishings, paints and others do badly too.”
Not just manufacturing, even the services sector is decelerating, the AAP spokesperson added. “Banks’ credit data shows that tourism, hotel and restaurants, transport, computer software, shipping and commercial real estate are down. Service sector which contributes more than 50 per cent to GDP mirrors the general slowdown.”