Last week, Prime Minister Modi gave an hour long speech denouncing ‘pessimists’ who refused to see the bright side of demonetisation and other transformations that his government’s able management had visited upon the economy.
We at Kafila, did a quick fact-check offering many reasons for pessimism, but as they say in Delhi – humari kya aukaat hai?
Now, a set of surveys by the Reserve Bank of India have concluded that 65% of the 5100 metropolitan households polled feel the economic situation has either worsened or stayed the same. It’s a small sample, but the results are revealing. To quote :
Households’ current perceptions on the general economic situation remained in the pessimistic zone for four successive quarters, with the outlook worsening — RBI
For those you wondering – “four successive quarters” is a full year.
I would urge most readers to read the report in full, but here are some key takeaways:
The Jobs ‘crisis’ is hitting supernova proportions
Not surprisingly, the biggest worry for households is jobs. Not only do 70% of households feel that employment prospects have worsened in the past year, 50.1% feel things will either remain the same or worsen (26%).
But then this relentlessly optimistic government that thinks the jobs crisis is actually opportunity. According to the present administration’s Railways Minister and resident wunderkind, Piyush Goyal, the reduction in jobs shows more Indians want to be entrepreneurs.
Many of those with jobs are earning less
Almost one in three respondents ( 27%) said they were earning less than before, while 46.8% said they were earning the same as before. People remain optimistic about the future, with 49% expecting to earn more in the coming year – but the structural crisis in the Indian economy suggests that is unlikely.
People are spending more – but that’s only because prices have gone up
Respondents’ pessimism on the price level has also become accentuated in the recent period — RBI
But don’t panic – as the government continues to assure us – an uptick is right around the corner. Till then, try to stay out of what the RBI calls the “pessimistic zone.”