Finance minister Nirmala Sitharaman is the ultimate counter alchemist: she can turn gold into dross.
A much-hyped press conference on Friday — that had set newsrooms across the country agog with excitement over another round of measures to jump-start a floundering economy — disintegrated into a non-event as Sitharaman ground to dust all questions about the timing of the economic turnaround, the financing of her budget for next year in the light of faltering direct and indirect tax collections this year and the failure of her government to pay out GST compensation cess to the states since August.
“I am not at the moment engaging with any of these prediction-based questions,” Sitharaman said testily when asked by which quarter she expected the economy to turnaround.
“I am looking at the economy. Where I need to intervene, I am intervening… and I shall continue to address the problems of industry as and when it arises… I am not in that stage to make predictions,” she said.
This is not the first time the finance minister has ducked searching questions about the economy. A couple of months ago she had famously remarked that she had no desire to analyse whether the economy had been bedevilled by cyclical or structural factors.
When a reporter said that some people had started to talk about a possible stagflation at a time factory output had shrunk in the past three months and inflation had soared to a 40-month high, the finance minister tersely replied: “No comments. Stagflation is a narrative that is going on. I am hearing it.”
The staccato answers, the facial grimaces and the manner in which her replies tailed off into conversational dead-ends clearly indicated that Sitharaman wasn’t keen to field the tough questions.
When a reporter pressed her to reveal whether there would be a slippage in the fiscal deficit target this year, she riposted: You don’t get bored asking the same question. I don’t get bored answering in the same way. Wait till the RE (revised estimates).”
Another reporter wanted to know if the finance ministry had tempered its own growth estimates, especially after the RBI trimmed its full-year growth forecast to 5 per cent from 7.4 per cent in February. She snapped: “The second half is not over yet”.
The talk soon turned to the GST and the speculation that the government might press for an increase in rates and cess at the next meeting of the GST Council scheduled for December 18. “The buzz is everywhere other than in my office… Don’t know where this is coming from. I have not been to the GST Council yet. Whether to request them for a rate hike or ask them to review… we have not held a discussion yet… But it is good to see this churn outside. It helps us to clarify our thought process,” she said.
Did this mean that the government has abandoned the idea altogether? “I am not saying that. No, no,” she replied quickly.
The finance minister acknowledged that the states had the right to seek GST compensation but gave no firm indication by when the dues that have piled up since August will be repaid.