LS polls: FM Sitharaman questions 'lofty promises' in Congress manifesto

Sitharaman said post-pandemic, the Narendra Modi government pursued a "balanced approach" to fiscal consolidation while sustaining economic growth

Union Finance Minister Nirmala Sitharaman on Monday questioned the viability of the “lofty promises” in the Congress manifesto and asked whether the party would borrow substantially and raise taxes to fund the proposed schemes.

 “Has @INCIndia considered the cost of the lofty promises made in their manifesto? Have they calculated how much the ‘Khata Khat’ schemes will cost fiscally? Will they borrow substantially for them, or will they raise taxes to fund them? How many welfare schemes would @RahulGandhi shut down to accommodate the fiscal cost of the ‘Khata Khat’ schemes?,” she said in a series of posts on X.

 The Congress in its manifesto released last month promised to fill 3 million vacancies in government jobs, launch an urban employment programme for the poor, and provide Rs 1 lakh annually to women heads of poor households. Under the proposed right to apprenticeship scheme, the party has promised to pay Rs 1 lakh per year stipend to unemployed youth under 25 years.

“Would @RahulGandhi care to answer these real questions and explain how their gigantic schemes of fiscal splurge would work without increasing taxes or borrowing heavily and running down the economy?,” Sitharaman asked.

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The finance minister claimed the Narendra Modi government’s fiscal management was much better than that of the UPA regime despite facing the Covid-19 pandemic in which substantial resources were used for relief efforts. She said the central government debt, including external debt at current prices, grew 3.2 times during the UPA rule from FY04 to FY14, compared to 2.9 times from FY14 to FY24. “This lower increase between FY14 and FY24 occurred despite the impact of the Covid-19 pandemic, where the Centre borrowed to provide relief to those in need even as revenues fell,” she added.

The minister said after the pandemic, the Narendra Modi government pursued a “balanced approach” to fiscal consolidation while sustaining economic growth. This strategy reduced the fiscal deficit from 9.2 per cent of GDP in 2020-21 to 5.8 per cent of GDP in the Revised Estimate for 2023-24. The Interim Budget projects a further reduction in the fiscal deficit to 5.1 per cent of GDP in 2024-25. “Similarly, the Central government’s debt-to-GDP ratio fell from 61.4 per cent in 2020-21 to 57.1 per cent in 2023-24,” she further noted.

The finance minister said under the UPA government, between FY09 and FY14, India’s gross fiscal deficit remained at least 4.5 per cent of GDP. It was between 4.5 per cent and 5 per cent of GDP in three out of these 6 years, between 5 per cent and 6 per cent in one, and more than 6 per cent in two years. “And there was no Covid-19-like crisis that needed such a quantum of fiscal expansion, showing poor fiscal management by the UPA,” she argued.

 Sitharaman said the UPA's legacy of fiscal shortsightedness and hidden debts contrasts sharply with the era of transparent, strategic, and transformative investments under the Narendra Modi government. “The question isn’t just about borrowing; it’s also about applying thought on expenditure. The Congress is interested in spending on short-term populist measures and there has never been a focus on long-term development,” she added.  

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