Sitharman hits back at Chidambaram, says doesn't want to learn from his faulty remedies

Finance Minister Nirmala Sitharman on Tuesday hit back at former finance minister P Chidambaram for his 'incompetent doctors' overseeing the economy comment, saying she doesn't want to learn from those who gave "faulty remedies" and under whom FDI literally ran away and "cronies" fled the country after defaulting on bank loans.

In her usual combative style, she defended handling of the economy citing "seven specific green shoots" in rising foreign direct investment (FDI), net foreign portfolio inflows, kicking off of Rs 103 lakh crore infrastructure pipeline, jump in foreign exchange reserves, GST collection topping Rs 1 lakh crore in six months in current fiscal, rebound in industrial production and surge in stock markets.

To defend her Budget for 2020-21, she reeled out announcements of last year including reduction in tax rate on income generated by companies, compared steps taken by the Congress-led UPA during global financial crisis of 2008-09 and took credit for the Reserve Bank of India (RBI) cutting interest rates by as much as 135 basis points last year to boost growth from its worst showing in 11 years.

She first spoke at length in the Lok Sabha, giving out statistics and hard data to defend not just budgetary allocation but also the slippage in fiscal deficit target for the third year a row.

"There are seven important macroeconomic indicators which show that there are green shoots in the economy... economy is not in trouble," she said replying to the debate on the Budget 2020-21 in the lower house of Parliament.

Hours later, she came to the Rajya Sabha with a shorter and crisper reply, much of which targeted Chidambaram who had on Monday stated that the "economy was perilously close to collapse and was being attended by incompetent doctors" and that the government had predispositions.

"A lot of assumptions were being put on us... One thing I concede and that is it is certainly predisposed about not repeating faulty remedies that the UPA government gave in 2008-09. None of that will be repeated by us," she said.

The UPA had opened up lending to boost economic activity to insulate the country from the global financial meltdown. Some of the loans advanced later turned out to be NPAs after few sectors of the economy faced a downturn.

"What was the remedy offered in 2008-09 and what did it result in. We certainly don't want that burden on the economy for today or for the future," she said adding the UPA during 2004 and 2014 was "very fortunate" to inherit a cushion in the good work of Atal Bihari Vajpayee government of the previous five years.

The finance minister said she would take comments and suggestions made by everyone but not "when you are constantly throwing barbs at us".

"The diagnosis of what went wrong between 2008-09 and the treatment that has been offered here I would like to list out some of them," she said listing twin balance sheet crises faced by banks in 2014 as well as mounting NPAs as a fallout of the steps taken then.

Stating that the government was trying to bring back a number of cronies ran away from the country after taking money from banks, she said: "So that twin balance sheet problem is not something which I would not want to learn from those very competent doctors."
"But we have not done that. So we have not taken the remedies offered by the competent doctors," she said. "We have not fudged any of our accounts. We have not pushed it to oil marketing companies."
Sitharaman said in 2012-13, foreign investment recorded a negative 36 per cent growth. "Literally FDI ran out of this country. And this is competent doctors holding the economy together."