How Indian Economy got hit & how it can bounce?

Indian economy got hit primarily due to the following reasons in spite of revolutionary economic, financial,labor and governance reforms were brought in place in last five & half years under the dynamic leadership of Modi with an over all improvement in governance ensuring accountability, transparency, efficiency and expediency:

1.Huge NPAs that were caused as result of discriminate lending rather circular lending (topping up loan one after another with no returns with out any forensic audit) with a single motive of carrying out large scale corruption during UPA-I & II regimes between 2007 & 2014, could not be settled fast enough according top most priority,so it brought a halt in lending on one side and no criminal proceedings at a desired fast pace initiated against who orchestrated this. It could have derailed Indian Economy for a very long time if demonetization was not induced at a right time with right amount of impact bringing in an element of surprise. So, Indian Dispute Resolutions System at DRTs, NCLTs & NCLATs and cases including running under IBC and Criminal Proceedings against unscrupulous promoters were involved in causing such huge NPAs with an intent of siphoning money via illegitimate routes should have been sorted out through Fast Track Mechanism & Fast Track Courts (FTCs) fixing them with in a short span of 02 years even running FTCs on holidays and in day & night shifts according top most national priority. Not doing it fast enough blocked huge amount of money nearly rupees 15 lakh crores and induced huge scarcity of liquidity in the financial systems towards lending. This discriminatory lending to the people as part of Crony-Capitalism with out carrying out forensics audits to the corporate ( unscrupulous promoters) during UPA-I & II was of the order of nearly 33.4 lakh crore between 2007 & 2014 alone while PSBs extended loans to Corporate only Rs.18.40 lakh crore between 1947 and 2007. So, Indian economy was hit by this amount that was not productive towards growth in many ways besides causing the huge NPAs and by virtue of the same the micro & macro economic parameters were affected adversely and its impacts are now realized as hitting Indian Economy. But I am sure that Indian Economy shall bounce in FY 2020-21 as it has been turned in to a most robust & structured Formal Economy with corrections induced in the form of IBC in last 05 & half years by Modi Govt.These NPAs hit PSBs most adversely resulting them in loosing not only profits but also credit appetites for a long time as they were to write off huge amounts to take care of NPAs on their balance sheets.On top of it GoI has to infuse huge amount of money of the order of 4.7 lakh crores to take care of these PSBs as affected by NPAs. Also, bankers had a fear that they shall be tried though they acted under orders from top / Ministers & decision makers in the government that time.So, this huge money if was not provisioned for this purpose but for the empowerment of farmers and in uplifting poor's conditions of the country or in additional Infrastructure Creation, I am sure it would have resulted in a increased income in the hands of poor and that should have enhanced consumption in rural areas tremendously and as a result demands could have been higher in certainty. It would have increased production and surely more job creation.So, Judicial Reforms in totality and Dispute Resolution System needs a Fast Track mechanism with in the ambit of certain resolution with in 12 months including exhausting provisions of appeals with utilization of Digital Technology and sound practices of Mediation. The discriminate lending of such huge amounts to unscrupulous promoters resulting in creation of huge NPAs & its slow process of resolution has affected Indian Economy at least by $ 0.5 trillion mark since 2007.So, impact has to be felt and side by side Global Melt Down or a bit of recession or one can call it extreme slow down pace is also experienced along with stresses of Global Trade Disputes, so, Indian Economy is also undergoing the impact of the same as well. The PSBs along with NPAs have also encountered large scale of banking frauds that started during UPA time but surfaced during this government and new frauds have taken place as well. This is another impediment to impact the credit appetite of PSBs.

2. GST theft has not been brought under check and many companies are managing paying less GST on their production as they are concealing their data in many ways so it resulted in less GST collections. So, it has also affected GoI spending on Infrastructure creation at fast pace.So, it needs a Strong Regulatory Systems with Checks & Inspection / Raids in place with Fast Track Dispute Resolution Mechanism at the earliest. GST slabs are to reduce to 02 slab mechanism one at 08 % and another 16% leaving only few items at 28%. GST frauds must be caught with proactive vigilant systems in place.

3.Rural infrastructure Development and Farmer's & Poor Income Enhancement schemes have not taken off on grounds at a pace that was required,hence, not able to boost rural consumption and that reduced the Rural Demand .

4. Inequality has not been arrested to the desired level in spite many revolutionary schemes that have resulted bringing out about 165 million poor out from BPL in such a short time and ensuring Inclusive Growth.Needs more attention on this considering it as Single Most Important Priority for GoI.

5. Defence & High Tech Electronic Manufacturing has not taken place as it was needed at a very fast pace with Modi govt in place 2nd time.So, called Wealth Creators have done very little towards this most important element of growth in an fastest emerging economy.

6. MSMEs have not been converted in to contributing to quality products in order to boost exports.

7. This Government announced and projected the need of the Electrical Vehicle with out any plans and policy in place in-respect of charging stations and scrapping of old vehicles and that affected the diesel as well as petrol vehicle demands for about 02 years as consumers delayed their decisions in buying conventional vehicles in wait of EVs. Though after a wait again demands for these vehicles is increasing slowly.

With these points for the kind attention of Modi ji & GoI including Finance Minister, I would like to state with solid conviction that FY 2020-21 shall see a growth at about 6.5% to 7 % if all the above issues are settled fast enough as oil prices are destined to see a decline due to growing market capitalization by EVs, climate change and global slow down .It is also recommended that External borrowings at Zero % or 1 to 2 % Annual Interest Rate as available in global market may be exercised and India must use this opportunity to bring up its Infrastructure especially the Rural Infrastructure to a level of Global Best at a very fast pace inducing Skill Development at a huge pace covering the entire population that needs it. Modi ji is making a huge difference in governance with candid reforms and I am sure India shall touch $ 5 trillion economy mark by 2024-25 if credit culture gets change as recommended. India cant afford to lend to corporate generously and than facing NPAs nearly 45-50 % and lenders / PSBs take haircuts up to 70%. There may be some bonafide situations but certainly not the genuine ones.Further request read my #1 best seller book at Amazon " India- A $ 20 Trillion Economy by 2035-40".The Privatization of National Assets or Nav Ratnas must not be done in haste for raising & getting money in the hands of GoI as they are level players in our Democratic Setup for taking care of common man & poor as giving handsome dividends in terms of jobs creation, continuity of quality jobs and financial earnings to GoI and also it supports Inclusive Development taking care of Inequality in positive way.

My best wishes to Modi ji and I am sure that with these changes he is becoming more popular and wins again in 2024.