I am deeply conscious of the absence of Shri Arun Jaitley today. I am sure the House joins me in wishing Shri Jaitley speedy recovery, good health and a long life in the service of the nation.
Madam Speaker, the people of India gave a strong mandate to our Government. Under the visionary leadership of Hon'ble Prime Minister Shri Narendra Modi, we have given the most decisive, stable and clean Government and have undertaken transformational structural reforms. We have reversed the policy paralysis engulfing the nation and have restored the image of the country. The major achievement of this Government was that we strived our utmost to change the mind-set and ignited the self-confidence of the nation.
I can proudly say that India is solidly back on track and marching towards growth and prosperity. We have prepared the
foundation for sustainable growth, progress and better quality of life for all our people.
We are moving towards realising a ‘New India’ by 2022, when we celebrate 75 years of India’s independence: an India which is clean and healthy, where everybody would have a house with universal access to toilets, water and electricity; where farmers’ income would have doubled; youth and women would get ample opportunities to fulfil their dreams; an India free from terrorism, communalism, casteism, corruption and nepotism.
Madam Speaker, the last five years have seen India being universally recognised as a bright spot of the global economy. The country witnessed its best phase of macro-economic stability during this period. We are the fastest growing major economy in the world with an annual average GDP growth during last five years higher than the growth achieved by any Government since economic reforms began in 1991. From being the 11th largest economy in the world in 2013-14, we are today the 6th largest in the world. Besides generating high growth rate, we contained double-digit inflation and restored fiscal balance.
Inflation is a hidden and unfair tax on the poor and the middle class. The average rate of inflation during 2009-2014 was a backbreaking 10.1%. The then Prime Minister admitted as much when he said, “We have also not been as successful in controlling persistent inflation as we would have wished. This is primarily because food inflation has increased.” In contrast, our Govt. broke the back of back-breaking inflation. We brought down average inflation to 4.6% which is lower than the inflation during the tenure of any other Government. In fact inflation in December 2018 was down to 2.19% only. If we had not controlled inflation, our families would have been spending around 35-40% more today on basic necessities such as food, travel, consumer durables, housing etc.
From the high of almost 6% seven years ago, the fiscal deficit has been brought down to 3.4% in 2018-19 RE. The current account deficit (CAD), against a high of 5.6% six years ago, is likely to be only 2.5% of GDP this year. We contained the fiscal deficit notwithstanding the Finance Commission's recommendations increasing the share of the States from 32% to 42% in central taxes, which we accepted in the true spirit of cooperative federalism, thereby transferring significantly higher amounts to the States.
Due to a stable and predictable regulatory regime, growing economy and strong fundamentals, India could attract massive amount of Foreign Direct Investment (FDI) during the last 5 years - as much as $239 billion. This period also witnessed a rapid liberalisation of the FDI policy, allowing most FDI to come through the automatic route.
Madam Speaker, the last five years have witnessed a wave of next generation structural reforms, which have set the stage for decades of high growth. We have undertaken path breaking structural reforms by introducing Goods and Services Tax (GST) and other taxation reforms.
Banking Reforms and Insolvency and Bankruptcy Code (IBC)
The period of 2008-14 will be remembered as a period of aggressive credit growth and, as per RBI, the primary reason for spurt in non-performing loans and stressed assets. Outstanding loans of public sector banks ballooned from 18 lakh crore to 52 lakh crore during this period. Many projects were started that could either not be completed or had low capacity utilisation resulting in their inability to pay back their loans. There were high stressed and non-performing assets (NPAs) amounting to 5.4 lakh crore in 2014. Many more were hidden through restructuring or otherwise which were discovered during Asset Quality Reviews and inspections carried out since 2015.