Kerala Finance Minister Slams Economic Survey for Ignoring India's Economic Challenges

Kerala Finance Minister K N Balagopal criticised the Economic Survey report presented by the central government in Parliament. He stated that it does not accurately reflect India's current economic situation, particularly in terms of poverty, unemployment, inflation, and production slump.

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Balagopal highlighted that despite various estimates in June indicating a 9.36 per cent increase in food prices, the central government claims there is no inflation. He pointed out that India ranks 111th among 125 countries in the poverty index and cited a Harvard University study stating that 67 lakh children in India do not get to eat even once a day.

Inflation and Poverty Concerns

The minister disputed the report's claim of a 5.4 per cent inflation rate, noting varying rates across states. For instance, Odisha has an inflation rate of 7.2 per cent, Bihar 6.4 per cent, and Kerala 5.83 per cent. He argued that ordinary people are struggling with high prices despite these claims.

Balagopal also criticised the central government's revenue deficit for 2023-24, which stands at Rs 8.4 lakh crore or 2.8 per cent of the GDP. In contrast, Kerala's revenue deficit is only 1.48 per cent. He emphasised that Kerala is effectively implementing fiscal consolidation measures mandated by the Fiscal Responsibility Act.

Debt and Economic Growth

The minister highlighted the increasing debt burden on the country, which has risen from Rs 45.17 lakh crore in 2011-12 to Rs 183.67 lakh crore. He noted that Kerala's debt is only 33.09 per cent of its domestic product, contrary to claims that the state is in a debt trap.

Balagopal questioned the report's growth projection of 6.5 to 7 per cent for the current financial year, stating this claim has been made despite global economic growth being stagnant at 3.2 per cent. He also questioned the claim of achieving an 8.2 per cent growth rate last year due to a lack of supporting evidence.

Impact on Agriculture and Public Expenditure

The minister expressed skepticism about the central government's declaration to rationalise public expenditure, given its reduction of fertiliser subsidies by 22.4 per cent and food subsidies by 24 per cent. He emphasised the need to assess the impact of new policies on the agricultural sector, which he said is already struggling.

Earlier, while speaking to reporters, Balagopal noted that if the growth rate recorded by the Economic Survey is accurate, it should be reflected across the country. He highlighted the importance of revenue growth in states and stressed the need for the manufacturing sector to drive economic growth.

Unemployment and Economic Reality

Thomas Isaac, former finance minister of Kerala, concurred with Balagopal's views. He stated that while the Economic Survey presents a rosy picture of the Indian economy, it fails to address pressing issues like unemployment.

Balagopal concluded by saying that merely pretending significant economic growth has been achieved does not address underlying issues like poverty and unemployment effectively.