Raghuram Rajan says, India is dangerously close to Hindu rate of growth

NEW DELHI: Former Reserve Bank of India governor and economist Raghuram Rajan has warned about the Hindu rate of growth. Rajan said India is dangerously close to the Hindu rate of growth due to weak private sector investment, high interest rates and slow global growth. Rajan said the latest estimates of national income, released by the National Statistics Office (NSO) last month, show that the sequential deceleration in quarterly growth is a matter of concern.

Statistics show that the gross domestic product (GDP) has declined to 4.4 per cent in the third quarter of the current financial year from 6.3 per cent in the second quarter and 13.2 per cent in the first quarter,whereas, the growth rate in the third quarter of the last financial year was 5.2 per cent.

Raghuram Rajan said,” I am worried about the sequential slowdown. The RBI is still raising rates, and global growth is likely to slow at the end of the year”. The former governor said that it is not known where in all this we will find additional growth rate. He said, the biggest question is what will be the Indian growth rate in the financial year 2023-24. "If we get five per cent growth, we will be lucky," he said.

“It is dangerously close to our old Hindu rate of development.We should do better. The government is doing its bit on investing in infrastructure, but the push to build it is yet to pay off. Recently Chief Economic Advisor V Ananth Nageswaran attributed the slow quarterly growth to the upward revision of estimates of national income for previous years.

Hindu growth rate is a term describing the low Indian economic growth rate from the 1950s to the 1980s. The term was coined in 1978 by Raj Krishna, an Indian economist, to describe slow growth.

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