Former finance minister P Chidambaram (File photo: PTI)
NEW DELHI: Former finance minister P Chidambaram on Monday said that the government’s Rs 20 lakh crore stimulus package has left several sections high and dry including bottom half of the population, migrant workers, farmers and landless agricultural labour.
In a media briefing via video conferencing, the senior Congress leader noted that most analysts, ratings agencies and banks have placed the size of the fiscal stimulus between 0.8 per cent to 1.5 per cent. He also said that the total package amounts to Rs 1,86,650 crore, that is just 0.91 per cent GDP (gross domestic product), while rest of the announcements included already budgeted expenditure, regulatory measures and proposed reforms.
“In our view, a fiscal stimulus of Rs 1,86,650 crore amounting to barely 0.91% of GDP will be totally inadequate given the gravity of the economic crisis and the dire situation in which people find themselves,” Chidambaram said.
“True value of fiscal stimulus package will, therefore, be known when we know what is the additional borrowing in 2020-21 to finance the additional expenditure over and above the expenditure budget. The truth cannot be hidden for long,” he added.
Expressing thorough disappointment over the package, the former finance minister requested the government to reconsider it and announce a revised and comprehensive one which is not less than Rs 10 lakh crore or real additional expenditure equivalent to 10 per cent of GDP.
Stating that fiscal deficit at this point should not be a cause of concern, the minister said: “It’s not the time to worry about fiscal deficit. If additional expenditure turns out to be another Rs 10 lakh crore & additional borrowing is ₹10 lakh crore, obviously fiscal deficit will go up but that should not be a matter of worry.”
Chidambaram also accused the government of being opportunistic by pushing reforms. It is bypassing Parliament and a discussion on the package and this will be strongly resisted, he added.
“I think the government is deliberately sidelining Parliament. A meeting of the Parliamentary Committee should at least be held to discuss the fiscal stimulus package,” he said.