PM Modi’s systematic targeting of SMEs is an economic disaster: Congress | India News – Times of India

NEW DELHI: The Congress accused the government on Wednesday of “systematically beating” the Indian SMEs and alleged that 140 crore Indians are now bearing the economic consequences of Prime Minister Narendra Modi’s “cronyism, arbitrary policy-making and refusal to deal with issues constructively”.
Congress General Secretary Jairam Ramesh cited a new report by credit rating agency India Ratings to argue that the three shocks of demonetizationthe “failed implementation of GST” and imposition of nationwide lockdown without prior notice has had a devastating impact on the economy.
The India Ratings report confirms what Congress has repeatedly warned: “The non-organic prime minister’s systematic targeting of India’s SMEs and informal enterprises is an economic disaster,” Ramesh said.
“Three shocks in particular were devastating. The non-organic Prime Minister’s surprise announcement on demonetisation on November 8, 2016, which virtually shut down all economic activity for the next few months, without any clear economic and social benefits,” he said.
Ramesh also referred to the “failed implementation of GST” in July 2017, which had a complicated tax structure, high compliance burden and strict enforcement.”
He said the third shock was the decision to impose a nationwide lockdown on March 24, 2020 due to COVID-19, without prior notice, adequate preparation or an economic program to protect the informal sector.
“India Ratings has now put numbers to some of the devastating effects of these three shocks: The unorganised sector contributes 44+% to India’s gross value added (GVA). The unorganised sector grew at 7.4% compound annual growth rate (CAGR) between FY11 and FY16, but has suffered an average annual contraction of 0.2% since then,” the Congress leader said.
“In FY23, the GVA of unincorporated enterprises was 1.6 per cent below the FY16 level. This downturn in the unorganised sector cost India 4.3 per cent of its GDP or Rs 1.3 lakh crores. 63 lakh informal enterprises closed down due to these three shocks, leading to loss of 1.6 crore jobs,” he said, citing the report.
As record numbers of young people enter the job market, the Modi government is destroying jobs, he alleged.
Despite all the hype and bravado surrounding Make in India, the number of jobs in the manufacturing sector has fallen from 3.6 crore in FY16 to 3.06 crore in FY23, Ramesh said.
“Manufacturing is India’s ticket to solving unemployment and achieving sustainable middle-income status. The non-organic prime minister oversaw the destruction of India’s manufacturing sector,” he said.
Ramesh said the Congress has repeatedly warned the “non-organic prime minister” of these consequences.
“Dr Manmohan Singh went to Parliament to condemn demonetisation as ‘organised looting and legalised plunder’. Rahul Gandhi has repeatedly drawn attention to the devastation of the GST for job-creating MSMEs, pointing out that it was neither a good nor a simple tax,” he said.
In April 2020, after extensive consultations with stakeholders, Congress presented a five-point program to revive the informal sector during the COVID-19 pandemic, he said.
Ramesh pointed out that the Nyay Patra 2024 party had made strong proposals to revive the informal sector, including the imposition of GST 2.0, with a single, moderate rate and relief for small taxpayers such as MSMEs. The party also proposed to ease the tax burden on MSMEs owned by individuals and partnership firms, he said.
The Congress also wanted to create a level playing field and oppose the widespread monopolization and oligopolization that are crowding out SMEs, Ramesh said.
He said that “140 crore Indians are now bearing the economic consequences of cronyism, arbitrary policy-making and the non-organic Prime Minister’s refusal to engage constructively on issues”.