P. Chidamabaram—Modi Government a Prisoner of Ignorance and Its Own Fears I Mitali Mukherjee
- 3 years ago
In a searing indictment of the Centre, former Finance Minister P Chidambaram said the defining image of India for years to come will be of distressed migrant labourers walking thousands of kilometres to make the arduous journey home, with their children and meagre belongings.
In an interview to Mitali Mukherjee, the former FM said the stimulus measures announced so far would have little to no impact on the ground because “the government is a prisoner of its own ignorance and fear”.
Mr Chidambaram said the actual fiscal outgo from the measures announced by Finance Minister Sitharaman amounted to approx. Rs 5,000 crore whereas between Rs 10 -15 lakh crores of fiscal stimulus is what was required to restart the economy.
Mr Chidambaram also believes a far larger outgo could have been put in the hands of the poorest sections of society; “ Even if 13 crore families were given cash in hand of Rs 5,000 and food grain, the outgo would not be too much for the Centre, but would certainly help boost some demand and consumption by the poor.”
The former finance minister also questioned the logic of not allowing for FRBM relaxation for the States. He said “ States are being treated like Municipal Administrators. They must be allowed FRBM relaxation – even a 1% move on FRBM will give them a benefit of Rs 2 lakh crore, which can go a long way for them.”
Mr Chidambaram said the government seemed to have no exit strategy plan in place to resume economic activity. He also believed that in doing that, it is digging a deeper hole today; “ The time to act is today. If the government is open to listening to others and take their advice, we can see a revival by April 2021.” He pointed to the 7 quarters of recession India had been facing even before the COVID pandemic hit and said that was the government’s own doing. If the economic crisis is not fixed now, there will be pain for a much longer time.
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In an interview to Mitali Mukherjee, the former FM said the stimulus measures announced so far would have little to no impact on the ground because “the government is a prisoner of its own ignorance and fear”.
Mr Chidambaram said the actual fiscal outgo from the measures announced by Finance Minister Sitharaman amounted to approx. Rs 5,000 crore whereas between Rs 10 -15 lakh crores of fiscal stimulus is what was required to restart the economy.
Mr Chidambaram also believes a far larger outgo could have been put in the hands of the poorest sections of society; “ Even if 13 crore families were given cash in hand of Rs 5,000 and food grain, the outgo would not be too much for the Centre, but would certainly help boost some demand and consumption by the poor.”
The former finance minister also questioned the logic of not allowing for FRBM relaxation for the States. He said “ States are being treated like Municipal Administrators. They must be allowed FRBM relaxation – even a 1% move on FRBM will give them a benefit of Rs 2 lakh crore, which can go a long way for them.”
Mr Chidambaram said the government seemed to have no exit strategy plan in place to resume economic activity. He also believed that in doing that, it is digging a deeper hole today; “ The time to act is today. If the government is open to listening to others and take their advice, we can see a revival by April 2021.” He pointed to the 7 quarters of recession India had been facing even before the COVID pandemic hit and said that was the government’s own doing. If the economic crisis is not fixed now, there will be pain for a much longer time.
Like our work? Click here to support The Wire: https://thewire.in/support
The founding premise of The Wire is this: if good journalism is to survive and thrive, it can only do so by being both editorially and financially independent. This means relying principally on contributions from readers and concerned citizens who have no interest other than to sustain a space for quality journalism. As a publication, The Wire will be firmly committed to the public interest and democratic values.
We publish in four different languages!
For English, visit www.thewire.in
for Hindi: http://thewirehindi.com/
for Urdu: http://thewireurdu.com
for Marathi: https://marathi.thewire.in
If you are a young writer or a creator, you can submit articles, essays, photos, poetry – anything that’s straight out of your imagination – to LiveWire, The Wire’s portal for the young, by the young. https://livewire.thewire.in/
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