A day after authorities estimates confirmed that India’s GDP contracted by 7.3 per cent in 2020-21, senior Congress chief and former Finance minister P Chidambaram on Tuesday stated the federal government should get up and never lose one more yr, admit its errors of fee and omission, reverse its insurance policies, and heed the recommendation of economists.
He requested the federal government to print money if wanted and increase spending.
Arguing that 2020-21 has been the “darkest yr of the economic system” in 4 many years, he stated the present state of the economic system is essentially due to the influence of the pandemic, but it surely has been compounded by the “ineptitude and incompetent” financial administration of the BJP-led NDA authorities.
“Good recommendation by distinguished economists and famend establishments has been rebuffed. Worldwide expertise has been ignored. Recommendations on fiscal growth and money transfers have been turned down. Hole packages like Atma Nirbhar have fallen flat,” he stated at an AICC press convention.
On printing money, Chidambaram stated, “We now have the area and the sovereign proper to print money. If at any level the federal government feels that an excessive amount of is being printed, it may at all times cease printing money. However in the meanwhile, I feel printing money is clearly suggested.”
He stated all indicators level to the truth that the economic system is in dire straits.
He additionally stated the federal government is totally insensitive and impervious to what the lower-middle class and the poor are going by means of. Arguing that this isn’t the time to fear about fiscal deficit, Chidambaram stated, “We are able to’t lose one other yr like we misplaced the entire of final yr. And I’m afraid the best way this authorities is reacting it’s going to lose one other yr.
This, he stated, “is time to act boldly and decisively.”
“Borrow and spend — if crucial, print money and spend. Spend on healthcare, infrastructure however spend. And as a part of spending, spend on welfare measures additionally….which right now means money transfers and distribution of rations,” he stated.
Chidambaram recalled that Finance Minister Nirmala Sitharaman and Chief Financial Adviser Krishnamurthy Subramanian had talked concerning the economic system beginning to get better final yr, when the primary wave of the pandemic appeared to subside. “They noticed inexperienced shoots when nobody else did,” the Congress chief remarked. “They predicted a V-shaped restoration. It was a false story, and we had expressed our sturdy reservations and warned there have been no indicators of a restoration.”
The Congress, he stated, had then “identified that what the economic system wanted was a powerful dose of stimulus, together with elevated authorities expenditure, direct transfers of money to the poor and liberal distribution of free rations”, however “our pleas fell on deaf ears, and the result’s a destructive development of (minus) 7.3 per cent.”