Finance Minister Nirmala Sitharaman stated in Parliament that there is no chance of India entering a recession or stagflation as the opposition pressed the administration on the recent spike in inflation.
While denying the claim that it was keeping the cost of necessities in check, Sitharaman claimed that the administration had successfully handled the nation’s debt and had also successfully managed inflation.
During a discussion on price increases in the Lok Sabha, the finance minister stated that “India’s general debt is also in a favorable condition compared to many other nations.” Despite revised estimates, India is still acknowledged as having the fastest-growing economy, said Sitharaman.
Despite global challenges, the Indian economy is “showing extremely strong indicators” and has kept inflation well below 7%, the minister added. She did, however, add that the world’s trade has not yet returned to normal after being severely damaged by the COVID-19 epidemic and the Russia-Ukraine war.
According to the minister, the government has taken steps to bring down the price of imports and has significantly reduced the tariffs on edible oils. Prices for edible oil have “sharply corrected” as a result, she emphasised. Sitharaman informed the House that the GST Council had made the decision following thorough deliberation in response to complaints about the most recent increases in tax rates on a variety of items.
To curb tax leakage, the GST Council agreed to charge select pre-packaged and labelled food goods. Participants in the multi-layered decision-making process included state representatives. Therefore, it is unreasonable for the states to hold the Center responsible, she argued.
The absence of GST on loose milk and other loose food items was reaffirmed by Sitharaman. The finance minister also said that MSMEs will profit from the recent decline in steel prices from their recent highs. She continued by saying that the macroeconomic fundamentals are “excellent” and that India has sufficient foreign exchange reserves.
During the discussion, the Congress party staged a walkout, which Sitharaman criticised. She stated, “Congress MPs are leaving, their hypocrisy has been revealed.” Before wrapping up her speech, Sitharaman pointed out that the GST compensation cess has been prolonged till 2026 and that states have not yet received one month’s worth of compensation. The state governments of Tamil Nadu, Telangana, Rajasthan, Jharkhand, Punjab, Kerala, and Chhattisgarh were also urged to pay off the outstanding debts owed by electricity producing and distribution corporations.
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