This post has been self-published on Youth Ki Awaaz by Satyam Gandhi. Just like them, anyone can publish on Youth Ki Awaaz.

Economic Slowdown: Why Is The Govt Not Focusing On Farmers And Rural Economy?

The state of the Indian economy today is worrisome. The quarterly GDP growth rate is at a six-year low, the unemployment rate is at a 45-year high, manufacturing growth rate is hovering near zero, automobile sector is in the worst phase in 19 years, the investment rate is falling, fast-moving consumer goods sector growth is below nominal GDP growth rate, gross domestic saving rate is falling since the last 6 years, there is a trust issue in credit sector, people are losing jobs, inventories are piling up in industries and the list goes on.

Some experts claim that the current slowdown is a result of the cyclical process and things will return to normal in coming quarters while sceptics argue that the wrong policies and structural problems have pushed the economy into a prolonged slowdown. However, the reasons for the slowdown may be attributed to bad policies along with the rising trend of de-globalization and trade war between the U.S. and China. The principal factor is lack of demand across all sectors of the economy, be it food package industry or automobile industry. It indicates that the purchasing power of both the middle class and poor has fallen. The fall in savings rate further strengthens the fact that people are neither saving nor spending money which means either their income has decreased or has been stagnant.

The perception that rich businessmen are “wealth creators” is myopic, and rests on the claim that only rich people can contribute to the growth story of India. Image via Getty

The agriculture sector is in distress; the rural economy is struggling from very low inflation resulting in stagnant income, urban wages are either stagnant or decreasing due to less demand but more supply of unskilled labour. The primary aim of the Modi government on the fiscal front was to control inflation and fiscal deficit, and they have successfully kept it under control, but it seems that controlling inflation has backfired. Price of agricultural products is stagnant, resulting in farm distress and fall in income and consequent fall in purchasing power—which is directly related to lack of demand.

The increasing skill gap is resulting in a high unemployment rate of both rural and urban men and women. Two policies, lousy implementation of GST and demonetization has impacted the informal sector the most. Lack of liquidity in the market, the negative impact of demonetisation on small industries along with harassment of small and medium businesses in filing GST returns resulted in invoking the wrath of the market. The most surprising fact of all these happenings is that average income, in the absolute sense, has been rising from past many years at a good speed. Rising income should have boosted domestic consumption and demand, but the recent slowdown indicates that the fruits of growth went only to a small class of so-called “wealth creators”, wealthy and elite businessmen.

The rise in NPAs has indeed affected the working of the banking system and severely reduced credit growth. Pressure from the government to decrease the share of NPAs on the one hand and to increase lending, on the other hand, has pushed the banking sector into the doldrums. RBI has lowered the repo rate to a nine-year low to boost lending, but it seems to have no impact on the economy. RBI has also transferred extra surplus worth ₹1,76,000 crore to the government. It depends upon the government how it is utilised. If it is used just to overcome the shortfall in tax revenue rather than for capital expenditure, then it will be of no use.

Government has announced many measures to revive the economy, but all of them seem to be focusing on only the supply side of the economy, and the demand side is completely ignored. A look into the measures will further strengthen the fact. The capital infusion of 70,000 crores into public sector banks to increase credit rate and liquidity in the market will have no effect until the trust issue—which has paralyzed banking sector—is resolved. Moreover, it must be ensured that the credit is used for investment, which is a tedious task. The investors are looking at the government to revive the economy from slowdown so that they can invest, and the government is looking at investors to invest in the market to revive the economy. Both are looking at each other, and it’s resulting in nothing, and this is the most worrying situation.

The tax relief given to Foreign Portfolio Investors will do nothing to boost domestic demand. Merging the banks will surely enlarge the scope of their operation, but it will take a lot of time to come on the ground. Reducing repo rate to decrease the interest rate on loans will help only when the benefit is passed to the people, but the government has no mechanism to ensure that the benefit is given to people, all it can do is to appeal to the banks to lower the interest rates.

Now the question arises, what to do to revive the economy and where the government is going wrong. The usual measure to revive any economy from slowdown is to follow an expansionary fiscal and monetary policy that is to increase government spending. When India was facing a similar situation in 2008, the fiscal deficit went up to 6% due to the increase in government expenditure, but this government is committed to tight fiscal discipline. Ideally, the government should loosen its grip over fiscal deficit and should increase its expenditure on capital investment. The fiscal deficit will go upward, but it can be controlled later, the primary aim should be to revive the economy from slowdown.

Once the cycle of savings and investment starts, it will have a multiplier effect and will boost the consumption, demand and consequently, the income of people. It will result in higher tax collection, and then the government will have more free space to deal with the fiscal deficit. The government should prioritize its spending in rural areas because it is the most stressed sector in current times. Once the rural economy starts growing, the purchasing power of people will also increase.

The skill gap is another area which needs the government’s attention. Increased expenditure in education and human resource development will ultimately benefit the economy in the coming future. We need to learn from South Korea, which invested in human resource development in its early years and now it is giving fruits. South Korea is the only country in the world to have a GDP growth rate of over 5% for more than 50 years. In the banking sector, the government should focus on creating a healthy credit culture and the stricter implementation of Insolvency and Bankruptcy Code. It will result in a decrease in the share of NPAs, along with an increase in lending.

Most importantly, the Government must focus on covering the increasing income disparity between rich and poor. India’s richest 10% of people have 77% of India’s wealth, and the gap is continuously increasing. The perception that rich businessmen are “wealth creators” is myopic thinking, which rests on the claim that only rich people can contribute to the growth story of India. The focus must be on reviving agriculture sector and rural economy.

India has vast potential for growth, and if we succeed in raising the income level of the poor and lower-middle-class, then we may experience growth like never before.

You must be to comment.

More from Satyam Gandhi

Similar Posts

By Aditi Mehrotra

By India Development Review (IDR)

By Anshula Mehta

Wondering what to write about?

Here are some topics to get you started

Share your details to download the report.

We promise not to spam or send irrelevant information.

Share your details to download the report.

We promise not to spam or send irrelevant information.

An ambassador and trained facilitator under Eco Femme (a social enterprise working towards menstrual health in south India), Sanjina is also an active member of the MHM Collective- India and Menstrual Health Alliance- India. She has conducted Menstrual Health sessions in multiple government schools adopted by Rotary District 3240 as part of their WinS project in rural Bengal. She has also delivered training of trainers on SRHR, gender, sexuality and Menstruation for Tomorrow’s Foundation, Vikramshila Education Resource Society, Nirdhan trust and Micro Finance, Tollygunj Women In Need, Paint It Red in Kolkata.

Now as an MH Fellow with YKA, she’s expanding her impressive scope of work further by launching a campaign to facilitate the process of ensuring better menstrual health and SRH services for women residing in correctional homes in West Bengal. The campaign will entail an independent study to take stalk of the present conditions of MHM in correctional homes across the state and use its findings to build public support and political will to take the necessary action.

Saurabh has been associated with YKA as a user and has consistently been writing on the issue MHM and its intersectionality with other issues in the society. Now as an MHM Fellow with YKA, he’s launched the Right to Period campaign, which aims to ensure proper execution of MHM guidelines in Delhi’s schools.

The long-term aim of the campaign is to develop an open culture where menstruation is not treated as a taboo. The campaign also seeks to hold the schools accountable for their responsibilities as an important component in the implementation of MHM policies by making adequate sanitation infrastructure and knowledge of MHM available in school premises.

Read more about his campaign.

Harshita is a psychologist and works to support people with mental health issues, particularly adolescents who are survivors of violence. Associated with the Azadi Foundation in UP, Harshita became an MHM Fellow with YKA, with the aim of promoting better menstrual health.

Her campaign #MeriMarzi aims to promote menstrual health and wellness, hygiene and facilities for female sex workers in UP. She says, “Knowledge about natural body processes is a very basic human right. And for individuals whose occupation is providing sexual services, it becomes even more important.”

Meri Marzi aims to ensure sensitised, non-discriminatory health workers for the needs of female sex workers in the Suraksha Clinics under the UPSACS (Uttar Pradesh State AIDS Control Society) program by creating more dialogues and garnering public support for the cause of sex workers’ menstrual rights. The campaign will also ensure interventions with sex workers to clear misconceptions around overall hygiene management to ensure that results flow both ways.

Read more about her campaign.

MH Fellow Sabna comes with significant experience working with a range of development issues. A co-founder of Project Sakhi Saheli, which aims to combat period poverty and break menstrual taboos, Sabna has, in the past, worked on the issue of menstruation in urban slums of Delhi with women and adolescent girls. She and her team also released MenstraBook, with menstrastories and organised Menstra Tlk in the Delhi School of Social Work to create more conversations on menstruation.

With YKA MHM Fellow Vineet, Sabna launched Menstratalk, a campaign that aims to put an end to period poverty and smash menstrual taboos in society. As a start, the campaign aims to begin conversations on menstrual health with five hundred adolescents and youth in Delhi through offline platforms, and through this community mobilise support to create Period Friendly Institutions out of educational institutes in the city.

Read more about her campaign. 

A student from Delhi School of Social work, Vineet is a part of Project Sakhi Saheli, an initiative by the students of Delhi school of Social Work to create awareness on Menstrual Health and combat Period Poverty. Along with MHM Action Fellow Sabna, Vineet launched Menstratalk, a campaign that aims to put an end to period poverty and smash menstrual taboos in society.

As a start, the campaign aims to begin conversations on menstrual health with five hundred adolescents and youth in Delhi through offline platforms, and through this community mobilise support to create Period Friendly Institutions out of educational institutes in the city.

Find out more about the campaign here.

A native of Bhagalpur district – Bihar, Shalini Jha believes in equal rights for all genders and wants to work for a gender-equal and just society. In the past she’s had a year-long association as a community leader with Haiyya: Organise for Action’s Health Over Stigma campaign. She’s pursuing a Master’s in Literature with Ambedkar University, Delhi and as an MHM Fellow with YKA, recently launched ‘Project अल्हड़ (Alharh)’.

She says, “Bihar is ranked the lowest in India’s SDG Index 2019 for India. Hygienic and comfortable menstruation is a basic human right and sustainable development cannot be ensured if menstruators are deprived of their basic rights.” Project अल्हड़ (Alharh) aims to create a robust sensitised community in Bhagalpur to collectively spread awareness, break the taboo, debunk myths and initiate fearless conversations around menstruation. The campaign aims to reach at least 6000 adolescent girls from government and private schools in Baghalpur district in 2020.

Read more about the campaign here.

A psychologist and co-founder of a mental health NGO called Customize Cognition, Ritika forayed into the space of menstrual health and hygiene, sexual and reproductive healthcare and rights and gender equality as an MHM Fellow with YKA. She says, “The experience of working on MHM/SRHR and gender equality has been an enriching and eye-opening experience. I have learned what’s beneath the surface of the issue, be it awareness, lack of resources or disregard for trans men, who also menstruate.”

The Transmen-ses campaign aims to tackle the issue of silence and disregard for trans men’s menstruation needs, by mobilising gender sensitive health professionals and gender neutral restrooms in Lucknow.

Read more about the campaign here.

A Computer Science engineer by education, Nitisha started her career in the corporate sector, before realising she wanted to work in the development and social justice space. Since then, she has worked with Teach For India and Care India and is from the founding batch of Indian School of Development Management (ISDM), a one of its kind organisation creating leaders for the development sector through its experiential learning post graduate program.

As a Youth Ki Awaaz Menstrual Health Fellow, Nitisha has started Let’s Talk Period, a campaign to mobilise young people to switch to sustainable period products. She says, “80 lakh women in Delhi use non-biodegradable sanitary products, generate 3000 tonnes of menstrual waste, that takes 500-800 years to decompose; which in turn contributes to the health issues of all menstruators, increased burden of waste management on the city and harmful living environment for all citizens.

Let’s Talk Period aims to change this by

Find out more about her campaign here.

Share your details to download the report.

We promise not to spam or send irrelevant information.

A former Assistant Secretary with the Ministry of Women and Child Development in West Bengal for three months, Lakshmi Bhavya has been championing the cause of menstrual hygiene in her district. By associating herself with the Lalana Campaign, a holistic menstrual hygiene awareness campaign which is conducted by the Anahat NGO, Lakshmi has been slowly breaking taboos when it comes to periods and menstrual hygiene.

A Gender Rights Activist working with the tribal and marginalized communities in india, Srilekha is a PhD scholar working on understanding body and sexuality among tribal girls, to fill the gaps in research around indigenous women and their stories. Srilekha has worked extensively at the grassroots level with community based organisations, through several advocacy initiatives around Gender, Mental Health, Menstrual Hygiene and Sexual and Reproductive Health Rights (SRHR) for the indigenous in Jharkhand, over the last 6 years.

Srilekha has also contributed to sustainable livelihood projects and legal aid programs for survivors of sex trafficking. She has been conducting research based programs on maternal health, mental health, gender based violence, sex and sexuality. Her interest lies in conducting workshops for young people on life skills, feminism, gender and sexuality, trauma, resilience and interpersonal relationships.

A Guwahati-based college student pursuing her Masters in Tata Institute of Social Sciences, Bidisha started the #BleedwithDignity campaign on the technology platform, demanding that the Government of Assam install
biodegradable sanitary pad vending machines in all government schools across the state. Her petition on has already gathered support from over 90000 people and continues to grow.

Bidisha was selected in’s flagship program ‘She Creates Change’ having run successful online advocacy
campaigns, which were widely recognised. Through the #BleedwithDignity campaign; she organised and celebrated World Menstrual Hygiene Day, 2019 in Guwahati, Assam by hosting a wall mural by collaborating with local organisations. The initiative was widely covered by national and local media, and the mural was later inaugurated by the event’s chief guest Commissioner of Guwahati Municipal Corporation (GMC) Debeswar Malakar, IAS.

Sign up for the Youth Ki Awaaz Prime Ministerial Brief below