Notebandi and the GST hit India's economic growth: Raghuram Rajan

WASHINGTON: Demonetization and the Goods and Services Tax (GST) were the two main obstacles that hindered India 's economic growth last year, said Friday. former RBI governor Raghuram Rajan, claiming that the current growth rate of 7% was not enough. to meet the needs of the country.

Addressing an audience at the University of California at Berkley, Rajan said that for four years – from 2012 to 2016 – India was growing at a faster pace before the growth is slowing down because of the double shock of demonetization and GST application. "It is interesting to note that growth has slowed at a time when growth in the global economy has peaked," he told a conference on the future of India.

On the occasion of the second anniversary of the demonetization, on November 8, Finance Minister Arun Jaitley strongly defended the project, saying that "the prophets of doom" had proved wrong, while solid Evidence shows an increase in the tax base, increased formalization of the economy and India has maintained the strongest economic growth for the fifth year in a row.

In his speech, Rajan said that a growth rate of 7% per year for 25 years is "very very strong," but that it has somehow been the new Hindu growth rate which was previously 3.5%. "" The reality is that 7% are not enough for the type of people who enter the job market and we need jobs for them. more and we can not be satisfied at this level, "he said.