Congress leader Jairam Ramesh launched a scathing attack on Prime Minister Narendra Modi-led central government citing a report by India Ratings and Research, a credit ratings company, alleging that under the PM Modi government, “the systematic bludgeoning of India’s MSMEs and informal businesses has been an economic catastrophe.”

Listing out three “shocks” that have been particularly devastating for MSMEs, the party’s general secretary in charge of communications stated that demonetization (November 8, 2016), rolling out GST (July 2017), and the COVID-19 lockdown (March 24, 2020).

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The Congress leader cited the numbers in the India Ratings report supporting the party’s earlier claims. The unorganised sector contributes more than 44% to India’s Gross Value Added (GVA), which grew at a 7.4% compound annual growth rate (CAGR) between FY11 and FY16 but has suffered an average yearly contraction of 0.2% since then, said the statement.

By FY23, the GVA of unincorporated businesses was 1.6% below FY16 levels. Ramesh stated that, as per the report, the recession in the unorganised sector cost the country 4.3% of its GDP, or Rs 1.3 lakh crores.

The Congress leader, referencing the report, stated that the Modi government was “destroying jobs” when “a record number of youth are entering the labour markets” as 63 lakh informal enterprises were shut down due to these “three shocks,” leading to the loss of 1.6 crore jobs.

“For all the hype and bluster of Make in India, manufacturing jobs were reduced from 3.6 crore in FY16 to 3.06 crore in FY23. Manufacturing is India’s ticket to solving unemployment and reaching a sustainable middle-income status. The non-biological PM oversaw the destruction of India’s manufacturing,” wrote Ramesh in his statement.

Continuing, Ramesh said that the grand old party had warned the “non-biological PM” of such consequences. He further quoted former Prime Minister Dr. Manmohan Singh, who had described demonetization as ““organised loot and legalised plunder.” The Congress leader also mentioned Rahul Gandhi had too repeatedly drawn attention to “GST’s devastation of job-creating MSMEs, pointing out that it was neither a Good nor a Simple Tax.

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Referring to how the Congress had proposed a five-point programme in April 2020 to revive the informal sector during the pandemic, the party leader suggested proposals under the Nyay Patra 2024 to “revitalise” the informal sector. The proposals include establishing GST 2.0 with a “single, moderate rate & relief for small taxpayers like MSMEs,” reducing the tax burden on MSMEs owned by individuals and partnership firms, and ensuring a “level-playing field and opposing the rampant monopolisation and oligopolisation that has crowded out MSMEs.”

Concluding the statement, Ramesh added that 140 crore Indians are “paying the economic consequences of the non-biological Prime Minister’s cronyism, arbitrary policymaking, and refusal to engage constructively on issues.”

Statement on the non-biological PM’s systematic destruction of India’s informal sector and MSMEs through the triple shocks of demonetisation, a botched up GST, and an unplanned COVID-19 lockdown. The non-biological PM’s cronyism and arbitrary policymaking has cost India Rs. 1.3… pic.twitter.com/BROJb1zpHW

— Jairam Ramesh (@Jairam_Ramesh) July 10, 2024

Earlier, Congress president Mallikarjun Kharge attacked the government, listing out government data and highlighting the rising unemployment rates in the country in an X post. “The truth is that Modi Govt is solely responsible for shattering the dreams of crores of Youth in the last 10 years!” Kharge said, slamming the central government for rejecting independent economic reports because they exposed its “shameless attempt to whitewash.”