NOT POOR PEOPLE, BUT CRONY CAPITALISTS TO GET BENEFITS FROM PROPOSALS
Prabhat Patnaik
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2023-02-03 10:52
The most outstanding feature of the Indian economy today is the sluggish increase in real consumption expenditure. Between 2019-20 and 2022-23 for instance the per capita real consumption expenditure has grown by less than 5 per cent which is less than the rate of growth of the gross domestic product. Even the meagre recovery from the depths of the pandemic in short has been investment-led rather than consumption-led. This has two obvious problems: first, such a recovery is patently unsustainable; it would simply lead to a pile-up of unutilised production capacity, of unused infrastructure, and hence of unrecoverable loans by banks that would inevitably choke off the recovery, apart from threatening the stability of the financial system itself. Second, the basic rationale of growth is to improve the living conditions of the masses; and if the level of consumption of the masses remains stagnant, then there is little point to this growth.