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Congress says India’s demand crisis result of sustained income stagnation

This is the fundamental reason behind India’s consumption slowdown,” Ramesh argued.

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The Congress on Sunday asserted that India was facing a demand crisis due to sustained income stagnation. It said the double engine of private investment and mass consumption, which drove a decade of continuous GDP growth under the UPA government, has been derailed during the past ten years of Prime Minister Narendra Modi’s government.

Jairam Ramesh, Congress general secretary in charge of communications, urged the government to adopt the Congress’s proposals, which include increasing MGNREGA wages to a minimum of Rs. 400 per day, ensuring a minimum support price (MSP) for farmers, implementing a loan waiver for farmers, and establishing a monthly income support scheme for women—steps he believes are essential to revive income growth in rural India.

Ramesh emphasised that the deterioration of India’s consumption patterns is becoming increasingly evident each day. He pointed out that last week, several CEOs from India’s corporate sector expressed concerns about a ‘shrinking’ middle class, and recent data from the NABARD’s All India Rural Financial Inclusion Survey (NAFIS) 2021-22 corroborates the claim that the demand crisis in India stems from income stagnation.

According to the survey, Ramesh highlighted that the average monthly household income ranges from Rs 12,698 to Rs 13,661 for agricultural households and approximately Rs 11,438 for non-agricultural households. “Assuming an average household size of 4.4, the per capita income in rural areas is estimated at Rs. 2,886 per month—less than Rs 100 a day. Consequently, a significant majority of Indians have very limited funds for discretionary spending beyond basic necessities,” he stated.

“This situation is hardly an isolated case; virtually all evidence leads to the same alarming conclusion: the average Indian can afford to buy less today than they could a decade ago. This is the fundamental reason behind India’s consumption slowdown,” Ramesh argued.

He cited data from the Labour Bureau’s Wage Rate Index, showing that real wages for labourers have stagnated between 2014 and 2023 and have even declined from 2019 to 2024. Furthermore, he referenced the Ministry of Agriculture’s statistics, stating that during Dr Manmohan Singh’s tenure, real wages for agricultural labourers grew by 6.8 per cent annually, whereas, under Modi, these wages have decreased by an annual rate of -1.3 per cent.

Ramesh also referred to the Periodic Labour Force Survey data, indicating that real earnings across all employment types—salaried, casual, and self-employed—have stagnated between 2017 and 2022. He included findings from the Centre for Labour Research and Action, asserting that the real wages of brick kiln workers have either stagnated or declined from 2014 to 2022.

“This decline in consumption is undermining our medium- and long-term economic potential, regardless of what quarterly GDP figures may indicate,” he maintained. He contended that without significant growth in consumption to create a viable market for their products, the private sector would be hesitant to invest in expanding production.

Ramesh pointed out that the government’s own Economic Survey (2024) acknowledged that private sector gross fixed capital formation (GFCF) in machinery, equipment, and intellectual property products has only increased by 35 per cent cumulatively over the four years leading to FY23. He noted a further decline in new project announcements by the private sector, which fell by 21 per cent between FY23 and FY24.

Recently, the Confederation of Indian Industry, the leading industry association, suggested that the government increase MGNREGA wages by 40 per cent, raise payments under the PM-KISAN scheme by one-third, and issue “consumption vouchers” for low-income citizens to use on specific goods and services over a six- to eight-month period.

Ramesh stated that these recommendations align with the proposals of the Indian National Congress outlined in its Nyay Patra for the 2024 Lok Sabha elections. These include raising MGNREGA wages to a minimum of Rs. 400 per day, ensuring MSP for farmers, providing a loan waiver for farmers, and establishing a monthly income support scheme for women. Ramesh called on the government to embrace these proposals to spur income growth in rural India after years of stagnation.

He reiterated that the dual forces of private investment and mass consumption that fueled the Congress-led UPA’s era of sustained GDP growth have been sidelined in the past ten years under the “non-biological PM.”

He emphasised it is time to restore this balance. Last week, the Congress also accused the government of deliberately undermining Micro, Small, and Medium Enterprises (MSMEs) through “careless policymaking, a disastrous demonetization, a flawed GST rollout, and an unplanned lockdown due to Covid-19,” attributing part of the departure from labour-intensive growth to these actions.

India News

Amit Shah, US envoy Sergio Gor discuss counter-terror cooperation after Modi-Trump G7 meeting

Amit Shah and US Ambassador Sergio Gor held talks in New Delhi on strengthening India-US cooperation in counter-terrorism, narcotics control and border security.

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Amit Shah

Union Home Minister Amit Shah held talks with US Ambassador to India Sergio Gor in New Delhi on Thursday, with both sides discussing ways to strengthen cooperation on security-related issues, including counter-terrorism, counter-narcotics efforts and border security. The meeting came a day after Prime Minister Narendra Modi and US President Donald Trump met on the sidelines of the G7 Summit in France.

According to statements shared by both leaders after the meeting, discussions focused on enhancing collaboration to combat terrorism, curb narcotics trafficking, strengthen border management and improve efforts to bring criminals to justice in both countries.

Shah said the two sides had a detailed discussion on expanding India-US cooperation in the security domain, particularly in counter-terrorism and counter-narcotics initiatives. He also reiterated India’s commitment to advancing the India-US Comprehensive Global Strategic Partnership under the leadership of Prime Minister Modi.

Meeting follows high-level engagement at G7 summit

The interaction took place shortly after the Modi-Trump bilateral meeting during the G7 Summit in France, where the leaders discussed trade, regional security, economic cooperation and other strategic issues. They also reviewed progress in various areas of bilateral cooperation.

Following his return from France, Gor described the Modi-Trump engagement as productive and highlighted positive outcomes for India-US relations. He said the two leaders held substantive discussions on trade, regional security and strengthening economic ties.

The latest meeting between Shah and Gor underscores continued high-level engagement between New Delhi and Washington on security and strategic matters as both countries seek to deepen cooperation across multiple sectors.

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India News

Cross-voting helps BJP-backed Parimal Nathwani win Rajya Sabha seat from Jharkhand

Cross-voting reportedly played a crucial role in BJP-backed independent candidate Parimal Nathwani’s victory in the Jharkhand Rajya Sabha election, while JMM’s Baidyanath Ram won the other seat.

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BJP-backed independent candidate Parimal Nathwani secured a Rajya Sabha seat from Jharkhand on Thursday, with reports indicating that cross-voting played a key role in the closely watched election. The second seat was won by Jharkhand Mukti Morcha (JMM) candidate Baidyanath Ram.

The election witnessed a three-cornered contest for two Rajya Sabha seats. Alongside Nathwani and Baidyanath Ram, Congress candidate Pranav Jha was also in the fray. Political observers had been closely tracking the possibility of cross-voting in the state, given the numerical strength of various parties in the Jharkhand Assembly.

Cross-voting speculation dominated the contest

Ahead of voting, both the ruling INDIA bloc and the NDA had taken measures to keep their legislators together amid concerns over possible defections and cross-voting. Political discussions in the state largely revolved around whether legislators would vote along party lines or support candidates outside their alliances.

Nathwani’s victory is being linked to support from legislators beyond the NDA’s expected vote base. Reports after the counting suggested that cross-voting may have influenced the final outcome, helping the BJP-backed candidate secure the required support.

The result comes as another example of cross-voting influencing Rajya Sabha elections, a trend that has been discussed in several states during recent Upper House contests.

Congress candidate misses out

While JMM’s Baidyanath Ram and BJP-backed Parimal Nathwani emerged victorious, Congress nominee Pranav Jha failed to secure one of the two available seats. The outcome is likely to trigger political debate over voting patterns within the state assembly and the extent of cross-voting during the election.

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India News

Manipur security operations intensified as protests continue over recent deaths

Security forces have intensified operations across Manipur as protests over recent deaths and fresh violence continue, prompting heightened deployments and search operations in sensitive areas.

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Security forces have stepped up operations across Manipur amid growing protests linked to recent deaths and fresh incidents of violence in the state. Authorities have increased deployments in sensitive locations and launched intensified search operations to maintain law and order as tensions remain high.

The latest security measures come after unrest erupted following the treatment and subsequent transfer of three injured Kuki youths. Protests outside the Regional Institute of Medical Sciences (RIMS) in Imphal led to clashes, prompting security personnel to use tear gas to disperse crowds and prevent the situation from escalating further.

Officials have been conducting search and area-domination operations in vulnerable districts while maintaining a strong presence around key installations and public spaces. Security agencies are also continuing efforts to recover illegal weapons and prevent armed groups from carrying out fresh attacks. Recent police data indicated that a significant portion of the arms looted during earlier phases of the conflict has already been recovered.

The state has witnessed renewed tensions in recent weeks, with multiple incidents involving armed attacks and community-related violence. Authorities have repeatedly appealed for calm while assuring residents that strict action is being taken against those involved in unlawful activities.

The Centre has also strengthened the security apparatus in the state in recent months through additional deployments, including specialised forces, as part of broader efforts to stabilise the situation and prevent further unrest.

Officials said security operations will continue in vulnerable areas and that all necessary measures are being taken to ensure public safety and prevent any deterioration in the law-and-order situation.

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