As several states across the country has increased demolition of illegal structures, opposition parties led by the Congress party has starting using the same to attack the BJP. Today Congress MP Rahul Gandhi used the bulldozer theme to target the Modi govt over economy, suggesting the govt has failed to contain inflation.
The MP from Wayanad in Kerala posted a tweet saying that while inflation has gone up to 6.95%, the Fixed Deposit interest rate has gone down to 5%. “Forget depositing ₹15-lakh to your bank accounts, PM Modi’s ‘masterstrokes’ have demolished your hard earned savings.”
While it is true that keeping money in bank fixed deposits no longer covers the impact of inflation, what the Congress scion has missed is that it is not recent phenomenon. Inflation rate has been more than bank deposit rates for several years now, and in fact, the difference between then two has come down in recent times.
Which means, the inflation-adjusted real value of FD returns has gone up comparatively, contrary to what Rahul Gandhi is saying.
The inflation rate was at its peak during the UPA government led by economist Dr Manmohan Singh, which was almost double the bank FD rates. During the UP-II govt, the Consumer Price Index growth rate was in double digits in multiple years.
The annual inflation in 2009 was 10.88, which had gone up to 11.99 in 2010. The rates for the next three years were 8.86, 9.31 and 11.06. The inflation rate declined sharply after BJP formed the govt at the centre. Since 2014, the average annual inflation rate has been below 7%.
On the other hand, bank deposit rates have been hovering in the range of 5-9%, and every year, it was less than the inflation rate. For example, when inflation had reached 12% in 2010, the average return on FD was around 6% to 7% according to RBI data for deposits of less than 3 years.
Which means, the difference was more than around 5% to 6%, against the current difference of 1.95% as per Rahul Gandhi’s data. The similar trend was seen other years as well, with the difference between annual inflation and average term deposit rate being in the range of 3% to 6%.
Therefore, during the UPA regime led by the Congress party, the difference between the inflation and bank deposit rates were much more than the current difference. Which means, depositors lost more value of their money by keeping it in the bank, compared to the current scenario.
Rahul Gandhi and other Congress leaders keep scoring such self-goals by highlighting the difference between UPA and NDA govts. Most of the time Congress leaders use economic indicators to target the Modi govt, it turns out the numbers were worst during their own govt. Similarly just a few months ago, Congress had attacked BJP over bribery in defence deals, while the bribes were paid during the UPA govt.
