Rajeev Malik, founder & director of Macroshanti PTE, spoke to CNBC-TV18 about the 2019 general elections and the GDP data.
Sharing his expectations from the 2019 election outcome, Malik said, “One has learned the hard way not to necessarily predict election outcomes as far as India is concerned. However, the general sense seems to be that we will get an NDA government, whether or not it is headed by current Prime Minister Modi remains up in the air.”
“The important point is, we have gone through a period when the previous government had a pretty strong majority and we have seen what all it has been able to do and a lot of what it has not been able to do as far as the macro setting is concerned. We have also had several instances in the past of coalition governments partly because of some weaknesses as far as the macro setting was concerned being successful in delivering a bit on the economic agenda. So we just have to wait and see. However, for all practical purposes I would go ahead with an NDA coalition with or without Prime Minister Modi,” he added.
On the GDP front, Malik said, “I think to a large extent some of the reasons why growth momentum is being lost are a combination of structural delayed policy action. So the GDP number that comes out the end of this month will probably be around 6 percent handle; nothing really to write home about given where India is in its development cycle, especially given how much loss in momentum is already been there.”
“What is worrying is that most of the drivers are now losing momentum, especially in terms of what is happening on the external front. The external side is not going to be a big positive contributor. We are already seeing consumption slowdown and investment, in any case there is nothing really in terms of sustained recovery anywhere on the horizon for now. So, I think the first policy statement that we get from the new government, irrespective of what its composition is, is going to be the Budget, but all these considerations will have to be taken into account,” he added.