NEW DELHI: Hitting back at former finance minister P Chidambaram for his ‘incompetent doctors’ overseeing the economy comment, finance minister Nirmala Sitharman on Tuesday said she doesn’t want to learn from those who gave “faulty remedies” and under whom FDI literally ran away and “cronies” fled the country after defaulting on bank loans.
Sitharaman defended handling of the economy citing “seven specific green shoots” in rising foreign direct investment (FDI), net foreign portfolio inflows, kicking off of Rs 103 lakh crore infrastructure pipeline, jump in foreign exchange reserves, GST collection topping Rs 1 lakh crore in six months in current fiscal, rebound in industrial production and surge in stock markets.
She first spoke at length in the Lok Sabha, giving out statistics and hard data to defend not just budgetary allocation but also the slippage in fiscal deficit target for the third year in a row. “There are seven important macroeconomic indicators which show that there are green shoots in the economy… economy is not in trouble,” she said replying to the debate on the Budget 2020-21 in the Lower House of Parliament.
To defend her budget for 2020-21, she reeled out announcements of last year including reduction in tax rate on income generated by companies, compared steps taken by the Congress-led UPA during global financial crisis of 2008-09 and took credit for the Reserve Bank of India (RBI) cutting interest rates by as much as 135 basis points last year to boost growth from its worst showing in 11 years.
Speaking later in Rajya Sabha, Sitharaman again took a dig at at Chidambaram saying the fiscal deficit was at a record high during the UPA regime when the economy was being handled by “competent doctors”.
Chidambaram had said a day earlier that the economy was on the verge of collapse as it was in the hands of “incompetent doctors”. The minister said said FDI “ran out of the country in 2012-13” under “competent doctors” who were then overseeing the economy and that India’s defence was paralysed by lack of equipment under UPA.”We are certainly predisposed about not repeating mistakes of UPA,” she said, adding there was more sarcasm than content in Chidambaram’s criticism of the Union budget.
She also mentioned the twin balance sheet crisis faced by the banks and the mounting NPA and fleeing defaulters. Also, she said, free trade agreements (FTAs) entered into by the UPA were hurting the country.
The finance minister said green shoots of recovery were visible with a rebound in industrial activity and GST collection crossing Rs 1 lakh crore-mark in six months of the current fiscal. Food inflation had not been allowed to cross acceptable thresholds under the Modi government, she said. The minister also said that fiscal discipline was maintained all through under the Narendra Modi government.
“What was the remedy offered in 2008-09 and what did it result in. We certainly don’t want that burden on the economy for today or for the future,” she said adding the UPA during 2004 and 2014 was “very fortunate” to inherit a cushion in the good work of Atal Bihari Vajpayee government of the previous five years.
Stating that the government was trying to bring back a number of “cronies” who ran away from the country after taking money from banks, she said: “So that twin balance sheet problem is not something which I would not want to learn from those very competent doctors.”
Again, the NPAs running into lakhs of crores of rupees was a fallout of “another remedy offered during the 2008-09 crisis”. “We certainly do not want to inherit or copy those remedies of competent doctors,” she said and went on to cite double-digit inflation, high fiscal deficit and government liability being passed on to oil companies to dress up the balance sheet as other ills of the UPA era.


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