nProjecting a dismal picture, former Finance Minister and senior Congress leader P Chidambaram on Monday said the "economy is in ICU" and "perilously close to a collapse" attended to by "incompetent doctors". He also said the economy is facing twin problems of rising unemployment and declining consumption terming them as "two elephants" in the room but the Government continues to live in denial.
Making these remarks while initiating a debate in the Rajya Sabha on Budget for 2020-21, he offered Finance Minister Nirmala Sitharaman the same advice that Narendra Modi as BJP's Prime Ministerial candidate had offered him in November 2013.
On November 2, 2013, a very distinguished political leader said and I quote: "Economy is in trouble. The youth wants jobs. Devote more time to the economy, not on petty politics. Please focus on the job at hand. Very wise advice. I can't do anything better than reading this piece of advice to the Finance Minister," Chidambaram quipped.
He said the need of the hour was to revive demand and incentivize investment. Moreover, more money has to be put in the hands of the masses rather than classes and do away with 'tax terrorism," Chidambaram said.
According to him, the economy was facing structural problems but the Government continues to believe they were cyclical in nature. Modi government's chief economic adviser for four years, Arvind Subramanian, has stated that the economy is in the ICU (Intensive Care Unit). But "I would say the patient has been kept out of the ICU and incompetent doctors are looking at the patient," Chidambaram said. Tearing into the Budget, the former finance minister said the BJP government lives in denial, refuses to acknowledge its mistakes and has an "outdated" predisposition towards protectionism and a strong rupee, and is against bilateral as well as multilateral trade agreements.
Chidambaram called demonetisation of old 500 and 1,000 rupee notes as well as the hurried implementation of a "flawed" Goods and Services Tax (GST) with wrong design, rates, structure and procedure and an unprepared system as "monumental blunders" that ruined the economy.
He urged the Government to realize its mistakes and have an open mind to debate it. While GDP has fallen to an 11-year low of 4.5 per cent in 2019 July-September quarter, agriculture is growing by just 2 per cent, while consumer price inflation has risen from 1.9 per cent in January 2019 to 7.4 per cent in a matter of 11 months.
Also, food inflation is at 12.2 per cent. Bank credit is growing 8 per cent with non-food credit rising by 7-8 per cent and credit to the industry by just 2.7 per cent.
Credit to agriculture has declined from 18.3 per cent to 5.3 per cent and that for MSMEs from 6.7 per cent to 1.6 per cent, he said.
He quipped that every competent doctor that the Modi government could ever find has left the country and listed out former Reserve Bank of India(RBI) governors Raghuram Rajan and Urjit Patel, former Chief Economic Advisor Arvind Subramanian and former NITI Aayog Vice Chairman Arvind Panagariya as persons who quit during the BJP rule.
Taking a dig at Sitharaman, Chidambaram said she read out a 160-minute speech but he could not make out what she was trying to say.
Manas Ranjan Bhunia(TMC)echoed more or less same apprehensions about the economy and said the economy is drowning. He remarked while China is battling with corona virus, India is hit by financial corona virus triggered by North Block (Finance Ministry office) and said people of the country will save economy.
The Samajwadi Party demanded augmenting of health budget and cautioned that improper allocation to the sector could crumble the economy. Stating this party MP Ravi Prakash Verma said health allocation should be enhanced from 2.3 per cent of GDP to 5 per cent.
However, Ram Chandra Prasad Singh (JD-U) termed the budget as "growth
Oriented," saying it took care of the masses with good policies for agriculture, ST, SC and the poor. BJP leader Arun Singh and AIADMK chief in the house A Navaneethakrishnan also lauded the budget.