Wage stagnation, inflation and inequality will stifle economic growth: Jairam Ramesh | Latest Indian News

Senior Congress leader Jairam Ramesh on Wednesday said the country’s economic growth has slowed over the last decade, adding that there has been stagnation in consumer demand growth in India.

“Over the last ten years, the consumption story in India has gone into reverse and has become the biggest pain point for the Indian economy,” the statement issued by the Congress leader said.

Ramesh identified three reasons for the slowdown, namely stagnant wages, high inflation and inequality.

“Resilient wages: Multiple data sources, including the government’s own official statistics such as the recently published Annual Survey of Industries (ASI) 2022-23, have shown clear evidence that workers today may be buying less than they were 10 years ago. Alarmingly, this wage stagnation may be due to declining productivity of Indian workers. As labor productivity falls and real wages stagnate, families will have less additional income to spend on consumption,” the statement said.

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“High Inflation: As noted by Dr. Viral Acharya, former Deputy Governor of the Reserve Bank of India, the last decade has seen the emergence of 5 large conglomerates, including the Adani Group, which are creating monopolies in 40 sectors (including cement, chemicals, petrol, construction and etc.),” the statement says.

“In 2015, when the common man was buying Rs. 100 goods, he paid 18% to the owner-industrialist. Today he pays Rs. 36 profits to the same owner. The rise in prices in the last few years is directly attributed to nepotism and government patronage to these conglomerates. This relentless rise in the cost of goods and services has undermined the average person’s ability to increase consumption, especially given the stagnation of wages,” he said.

Ramesh went on to criticize the government led by Prime Minister Narendra Modi, adding that inequality has reached its peak under him.

“Inequality: India’s recovery from the COVID-19 pandemic has been highly uneven and K-shaped, with rural India and the poor left behind. Rural two-wheeler sales, a key indicator of economic growth, remain lower than in 2018. flourishing,” he wrote.

Ramesh further stated that the country is facing its most unstable and challenging economic situation in many years.

“Wage stagnation, inflation and inequality are not just policy problems – they are structurally damaging India’s long-term growth prospects. They undermine India’s consumption growth and deprive the private sector of its single most important incentive to invest. These bottlenecks will stifle economic growth in the coming years if they are not taken seriously now, in a spirit of humility,” he said.