Putting up a brave face, Finance Minister Arun Jaitley has downplayed concerns over growth slowdown. Experts commenting on the economy growing at 6.1 per cent in the January-March quarter unanimously pin the blame on demonetisation. While India has lost the claim to being the world's fastest growing economy, Jaitley asserts that “we have restored the credibility of the Indian economy through decisiveness and tough policies.” At his press conference on Thursday he went on to recall advantages of demonetisation: digitisation, expansion of the tax base and less use of cash in deals. He may, however, be reminded that demonetisation’s original goals were a little different: end to corruption, black money and terror funding.

Growth rate slipped to 7.1 per cent in a year when monsoon was normal from 8 per cent when drought had hit large parts of the country. If calculated without indirect taxes, the GDP growth turns out to be the lowest in two years. Besides, even this dismal data does not accurately reflect the pain demonetisation caused in the informal sector, where massive job losses were reported. While admitting growth was flagging even before the “notebandi”, Jaitley proffered explanations for the less-than-rosy situation that marks the Modi government's three years in office: global trade shrank, big economies turned protectionist and geopolitical uncertainties in the last three years. It was not all that bad after all. Cheap oil provided the government a cushion. Taxes were hiked. Instead of stimulating growth, the taxpayer’s money was put into vote-winning populist schemes.

The note ban in November 2016 had hit an economy growing steadily in a difficult environment. Instead of providing a stimulus, the government caused a self-injury with demonetisation. The Finance Minister should have been honest enough to concede that something has gone wrong indeed. Jaitley mentions GST among the government’s achievements. GST would have happened long back had the BJP not scuttled the plan when the UPA proposed it. Secondly, it is too early to count GST benefits. Oratory or rhetoric cannot replace hard data. When the third-quarter GDP numbers came, Prime Minister Modi had mocked “Harvard” economists for distrusting people’s “hard work”. It will be interesting to watch how he responds now.