Indian economy close to collapse, terms demonetisation a 'monumental blunder': P Chidambaram

News Network
February 10, 2020

New Delhi, Feb 10: Former finance minister P Chidambaram on Monday tore into the Modi government's handling of the economy, saying it was close to collapse and was been attended by "very incompetent doctors."

Initiating the debate on the Union Budget for 2020-21, he said rising unemployment and falling consumption was making India poorer.

The economy, he said, is facing demand constraints and is investment starved. The economy is facing fall in consumption and rising unemployment.

"Fear and uncertainty prevails in the country," he added.

He said the chief economic advisor to the BJP government for four years, Arvind Subramanian has stated that the economy is in the ICU. But "I would say the patient has been kept out of ICU and incompetent doctors are looking at the patient," Chidambaram said.

"It is dangerous to have a patient out of ICU and being looked upon by incompetent doctors. What is the point standing around and chanting slogan 'Sab ka saath, sab ka vishwas'," he said, adding every competent doctor the Modi government could ever identify has left the country.

His said a list of such people included former RBI governor Raghurman Rajan, former CEA Arvind Subramanian, former RBI governor Urjit Patel and former NITI Aayog vice chairman Arvind Panagariya.

"Who are your doctors, I want to know," he said, adding the government considers Congress as untouchable and doesn't think of any good about the rest of the opposition and so doesn't consult them.

Chidambaram charged that instead of putting money in the hands of people, the Modi government "put money in hands of 200 corporates" by way of corporate tax.

He said Finance Minister Nirmala Sitharaman in her 160- minute budget speech did not talk of the economy and its management.

"You are living in echo chambers. You want to hear your own voice," he said.

Listing problems with the Modi government, Chidambaram said it refuses to admits in mistakes, lives in denial and has predispositions.

The demonetisation of old 1000 and 500 rupee notes, as well as the hurried implementation of the Goods and Services Tax (GST), are "monumental blunders" that ruined the economy, he said, adding the Modi regime is predisposed to protectionism, a 'strong' rupee and is against bilateral and multilateral agreements.

"It is living in denial," he said, adding the economic growth has fallen for hereto unseen six consecutive quarters.

He wondered on the narrative Finance Minister Nirmala Sitharaman was trying to give after reading out a 160-minute budget speech with few pages left unread.

Her budget neither made any reference to the Economic Survey nor picked up a single idea from it, he said.

Chidambaram, who is credited with presenting a 'dream budget' more than two decades back, said the GDP growth has declined for six consecutive quarters, 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 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.

Overall industrial index showed just 0.6 per cent growth. "Every major industry is either near zero or in negative zone," he said, adding thermal power plants are operating at just 55 per cent of the capacity as factories have either closed or are on the verge of closure.

"That gives you a good picture of the state of economy. You don't require MRI," he said. "You are in management for six years. How long can you blame previous managers."

He charged the government with burying unfavourable reports such as the labour survey that put unemployment at 45 -year high of 6.1 per cent at end of 2017-18. Also, consumer expenditure has falling to 3.7 per cent between 2011-12 and 2017-18.

Drilling holes in Budget numbers, he said the 2019-20 budget projected a nominal GDP growth of 12 per cent but ended with just 8.5 per cent. Fiscal deficit was targeted to be shrunk to 3.3 per cent of the GDP but ended by at 3.8 per cent and in the next fiscal it is being targeted at 3.5 per cent.

Revenue deficit was targeted at 2.3 per cent in fiscal ending March 31, 2020 but ended up at 2.4 per cent and in the next it will rise to 2.8 per cent, he said, adding capital expenditure in the next fiscal will shrink to 0.7 per cent from 1.4 per cent in the current.

Net tax revenue in the current fiscal was targeted at Rs 16.49 lakh crore but only Rs 9 lakh crore was collected in first nine months till December 2019 and "you want us to believe this will rise to Rs 15 lakh crore by March 2020," he said.

Similarly, expenditure in 2019-20 was pegged at Rs 27.86 lakh crore but only Rs 11.78 lakh crore spent during April- December and by March this is projected to rise to Rs 27 lakh crore.

"You have no money to spend... and these are masked by numbers," he said. "Numbers are not easily acceptable or believable."

Chidambaram said the government is facing shortfall in all forms of taxes - Rs 1.56 lakh crore on corporate tax, Rs 10,000 crore on personal income tax, Rs 30,000 crore on customs, Rs 52,000 crore on excise and Rs 51,000 crore on GST.

This despite "the extraordinary powers" and "all kinds of power" given to lower level tax officials, he said.

He read of list of heads under which allocation has fallen - food subsidy, agriculture, PM-Kisan, rural roads, mid-day meal scheme, ICDS, skill development, Ayushman Bharat, rural development and MGNEGA.

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Agencies
June 19,2020

New Delhi, Jun 19: Delhi minister Satyendar Jain's health has deteriorated further. He is infected with the coronavirus. Jain has also been diagnosed with pneumonia. He is being shifted to an ICU.  According to doctors, Jain is now kept full-time on oxygen support as his oxygen saturation level has dipped.  

Jain was admitted to Rajiv Gandhi Super Speciality Hospital early Tuesday after running high fever and suffering a sudden drop in oxygen level. The 55-year-old leader's test result came positive on Wednesday evening after a second test. Jain was brought to the hospital and was administered a test for the novel coronavirus infection on Tuesday morning, for which he tested negative. But he still ran fever and showed symptoms, so another test was done after 24 hours of the first.

He will now be shifted Max Hospital in Saket and administered plasma therapy. 

Union Home Minister Amit Shah has also wished for Jain's speedy recovery.

On Thursday, Delhi Deputy Chief Minister Manish Sisodia took over the charge of health, PWD, power and other departments held by Jain. Jain will remain the cabinet minister without any portfolio in the Arvind Kejriwal government until he recovers. 

On Sunday, Jain attended a high-level meeting on the coronavirus situation in the national capital, chaired by Union Home Minister Amit Shah, which was also attended by Delhi Lt Governor Anil Baijal, Kejriwal, Sisodia and Union Health Minister Harsh Vardhan.

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News Network
February 26,2020

Feb 26: In his first reaction to incidents of violence in Delhi which have left at least 20 people dead, Prime Minister Narendra Modi on Wednesday appealed for peace and brotherhood, and said he has held an extensive review of the prevailing situation in various parts of the national capital.

He also said it was important that calm and normalcy was restored at the earliest.

“Had an extensive review on the situation prevailing in various parts of Delhi. Police and other agencies are working on the ground to ensure peace and normalcy,” Modi tweeted.

Stressing that peace and harmony are “central to our ethos”, Modi said, “I appeal to my sisters and brothers of Delhi to maintain peace and brotherhood at all times.”

At least 20 people have been killed since Sunday in communal violence in Northeast Delhi, triggered after clashes between pro and anti-CAA protestors over the Citizenship (Amendment) Act.

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News Network
July 2,2020

Jul 2: Democratic presidential candidate and former US vice-president Joe Biden has said that if he wins the November elections, strengthening the relationship with India which is America’s "natural partner", will be a high priority for his administration.

"India needs to be a partner in the region for our safety's sake and quite frankly for theirs," he said in response to a question on India-US relationship during a virtual fundraiser event on Wednesday.

At the fundraiser hosted by Chairman and CEO of Beacon Capital Partners Alan Leventhal, the former vice president said that India and the United States were natural partners.

"That partnership, a strategic partnership, is necessary and important in our security," Biden said when asked by an attendee whether India is critical to the US' national security.

Referring to his eight years as the vice president, he said, "In our administration, I was proud to play a role more than a decade ago in securing Congressional approval for the US-India Civil Nuclear Agreement, which is a big deal".

"Helping open the door to great progress in our relationship and strengthening our strategic partnership with India was a high priority in the Obama-Biden administration and will be a high priority if I'm elected president,” Biden said.

Both as the vice president and a senator from Delaware, he was a big supporter of India-US relationship.

About the November polls, Biden said that the character of the country is on the ballot. The upcoming election is the most important poll of a lifetime and that the country is currently engaged in a battle for its soul, he claimed.

Biden also slammed President Donald Trump and his administration over the handling of the coronavirus pandemic.

"Trump ignored warnings from the very beginning, refused to prepare and failed to protect the country. Not just now but throughout his presidency, undermining the very core pillars of ours, what I would argue, moral and economic strength.

"I really do believe that our country is crying out for leadership and maybe even more important, some healing. Today, we have an enormous opportunity not only to rebuild but to build back better than before. To build a better future. That's what America does," he added.

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