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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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2 weeks ago

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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.

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NDA ahead in Maharashtra, Jharkhand, say exit polls

A gentle reminder on the exit polls prediction that in recent Assembly elections in Haryana and Jammu and Kashmir, the results turned out completely different and surprising from what was being predicted.

Published

15 hours ago

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November 20, 2024

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With the voting concluded in Maharashtra and Jharkhand and EVM and VVPAT being sealed and secured for the November 23 counting day, the focus shifts to what exit polls predict for the states. NDA is likely to form government in Maharashtra and Jharkhand, while exit polls predict setbacks for the INDIA alliance.

According to exit polls, the Mahayuti alliance (BJP, Ajit Pawar’s NCP and Shiv Sena (Shinde) will cross the majority mark with 150-160 seats in Maharashtra, while Maha Vikas Aghadi (Congress, Shiv Sena (UBT) and Sharad Pawar’s NCP) at 110-120.

In Jharkhand, the BJP-led alliance is likely to snatch away power from the JMM-led alliance, as per the exit polls, projecting 44-53 for NDA and  25-30 for the Opposition INDIA.

A gentle reminder on the exit polls prediction that in recent Assembly elections in Haryana and Jammu and Kashmir, the results turned out completely different and surprising from what was being predicted.

In Jharkhand, the BJP contested on 68 seats, All Jharkhand Students Union (AJSU) 10 seats, Janata Dal (United) 2 seats, and the Lok Janshakti Party (Ram Vilas) 1 seat, while Jharkhand Mukti Morcha (JMM) of Chief Minister Hemant Soren contested in 41 seats, Congress 30 seats, RJD 6 seats, and Communist Party of India (Marxist-Leninist) 4 seats.

In Maharashtra, under Mahayuti, the BJP contested in 149 constituencies, Shiv Sena in 81, and the Ajit Pawar-led NCP fielded 59 candidates, while under MVA, Congress contested in 101 seats, Shiv Sena (UBT) 95, and NCP (SP) fielded 86 candidates.

“Who can be a bigger surveyor in Jharkhand than us? We have been in Jharkhand for the last 3 months. We have seen how people wished for change. I am sure that the people have voted for BJP-NDA. We are going to form the government with a huge mandate,” said Union Minister and BJP’s Jharkhand election-incharge Shivraj Singh Chouhan on exit polls prediction.

“As per the trends that we have received from several agencies, BJP-led NDA has an edge in the state and we will form the government,” said state BJP chief Babulal Marandi.

“The trends are in favour of the Maha Vikas Aghadi and we will win more than 175 seats in the state,” said state Congress chief Nana Patole.

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Manipur extends internet ban for three days amid fresh violence

The administration suspended the services on November 16 for two days in an effort to prevent anti-social elements from spreading content that might create law and order problems. It had been extended for two more days on Monday.

Published

17 hours ago

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November 20, 2024

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Manipur extends internet ban for three days amid fresh violence

The Manipur government in its order today extended suspension of mobile internet services for three more days in seven districts.

After the recent fresh violence, the administration suspended the services on November 16 for two days in an effort to prevent anti-social elements from spreading content that might create law and order problems. It had been extended for two more days on Monday.

The statement said that the state government after reviewing the prevailing law and order situation decided to continue suspension of mobile internet services in the territorial jurisdiction of Imphal West, Imphal East, Kakching, Bishnupur, Thoubal, Churachandpur and Kangpokpi of Manipur for another three days.

Earlier on November 16, the administration imposed the suspension on both broadband and mobile internet services. Nonetheless, it lifted the restriction on broadband services on Tuesday, considering the hardships faced by common people, healthcare facilities, educational institutions and other offices.

Meanwhile, Chief Minister N Biren Singh on Wednesday has expressed grief over the killing of six people by suspected Kuki militants last week and said that those behind the gruesome act will be brought to justice soon.

The Chief Minister said that search operations are underway to find the killers of the three women and children, whose bodies were recovered from a river in Jiribam district last week. He also termed the killing of women and children as a crime against humanity.

Taking to X, CM N Biren Singh said that he stands here with profound sadness and anger to condemn the horrific killings of three innocent children and three innocent women by Kuki terrorists after being taken hostage at Jiribam.

He added that such barbaric acts have no place in any civilized society, and assured that the hunt for these terrorists is currently underway and they will be brought to justice very soon. The administration will not rest until they are held accountable for their inhuman actions, he concluded.

Reportedly, the six people had been missing since November 11 from a camp for the displaced in Jiribam, following a gunfight between militants and security forces that led to the deaths of 10 insurgents.

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Rahul Gandhi lauds Telangana govt’s move to make law for gig workers

The Congress-ruled governments have taken several steps in this direction, with the Congress dispensation in Rajasthan becoming the first state to legislate the welfare of gig workers, he said.

Published

17 hours ago

on

November 20, 2024

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Leader of Opposition in the Lok Sabha and Congress leader Rahul Gandhi lauded the move to make law for the welfare of gig workers by the Telangana government.

In a letter to Telangana Chief Minister Revanth Reddy, Gandhi urged the Chief Minister to conduct state-wide public consultations for the draft legislation.

The former Congress chief said he was impressed, during his recent visit to Hyderabad, by the vibrant public consultative process for the socio-economic, educational, employment, political and caste survey (ongoing in the state).

“I request you to conduct similar state-wide public consultations for the draft legislation for gig workers as well. Hearing from all parties will ensure that the law is robust, effective and meaningful. The process can also help anchor future regulations for this sector,” he said.

“I would be happy to be a part of the consultative process,” the Leader of Opposition in Lok Sabha said. He expressed confidence that Telangana would lead the way in building a sustainable gig economy for the future.

Noting that the Indian National Congress stands for the well-being of workers, especially in contractual roles, he said the party’s manifesto committed to framing a law to protect gig workers and enhance social security.

The Congress-ruled governments have taken several steps in this direction, with the Congress dispensation in Rajasthan becoming the first state to legislate the welfare of gig workers, he said.

Reddy assured Gandhi that the state’s gig workers policy would be made comprehensive, inclusive and fair in line with the latter’s “vision and promise”.

The Telangana Chief Minister posted on social media platform X a letter (dated November 11) sent to him by Gandhi with his suggestion.

“Dear @RahulGandhi Ji, All of our work is inspired by your vision, ideas and work. It gives us more energy that the Telangana Caste Survey has made you feel proud,” Reddy said.  

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