Former finance minister P. Chidambaram on Monday spoke about the economic elephants in the room that the Narendra Modi government is loath to discuss and served up on finance minister Nirmala Sitharaman a seven-year-old advice dished out by then Prime Minister candidate Modi.
“Economy is in trouble, youth want jobs. Devote more time to economics, not petty politics. Chidambaramji, please focus on the job at hand!” Modi, the then Gujarat chief minister who had already set his sights on the most important job in the country, had tweeted in 2013 when the economy was in the doldrums.
Taking part in the budget discussions in the Rajya Sabha, Chidambaram quoted Modi’s quote after saying that on “November 2, 2013, a very distinguished political leader said and I quote”.
The Congress veteran added: “Very wise advice. I can’t do anything better than reading this piece of advice to the finance minister.”
The former finance minister warned that the economy was “perilously close to a collapse” but it was being treated by “incompetent doctors”.
“We have an economy which is perilously close to collapse. It has to be attended to by very competent doctors. In the last few years, we have found the doctors are not so competent,” he said.
Chidambaram referred to a statement by former economic adviser Arvind Subramanian that the Indian economy was headed towards the intensive care unit (ICU).
“The chief economic adviser of your government for four years said the economy was in the ICU. I would say that the patient has been kept out of the ICU and incompetent doctors are looking at the patient. Every competent doctor you appointed has left the country,” Chidambaram said.
“It is dangerous to have a patient out of the ICU and being looked upon by incompetent doctors. What is the point standing around and chanting slogan ‘Sab ka saath, sab ka vishwas’?” he asked.
“Who are your doctors? I want to know,” he said, adding that the government considers the Congress an untouchable and does not think of any good about the rest of the Opposition and so doesn’t consult them.
“The obvious solution is to revive demand and incentivise investment. Nobody will invest in this uncertainty because of fear and uncertainty pervading the country,” he added.
“We are living in denial and we are ignoring two big elephants in the room — one is rising unemployment and the other is fall in consumption. Unemployment rises, consumption falls, the Indian economy becomes poorer and not richer,” Chidambaram noted.
Chidambaram said more money needs to be put in the hands of the people and “extraordinary powers” should not be given to junior tax officials to unleash “tax terrorism”.
He said finance minister Sitharaman in her budget speech had presented a grim picture of the economy. “She did not say ‘achchhe din ane wale hai (good days are ahead)’. It is good that she has forgotten those empty words,” he said.
Chidambaram referred to the 160-minute budget speech. “The question on my mind is what was the finance minister trying to say? If you take 160 minutes to read the speech and still a few pages are left to read, what is the narrative, what is the story you are trying to say? You are living in echo chambers. You want to hear your own voice,” he said.
“Because of its refusal to admit mistakes, because it lives in denial, because of its predisposition, the government either does not know or, if it knows, is not willing to make it clear that this is the state of the economy,” he said. “When we point out the mistake of the government, the government must have an open mind to debate and if it is a mistake, admit it.”
“It is living in denial. It simply does not accept that the state of the economy is extremely bad,” Chidambaram said, reeling off the government’s own statistics to drive home the point.
The GDP growth has fallen to an 11-year low of 4.5 per cent in the 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.
“In the initial years, you said these are legacy issues. You are in management for the last six years. You cannot go on blaming the previous managers. We had difficult situations. We managed,” Chidambaram said.
Additional reporting by PTI