Budget 2017 an economic management failure, says P Chidambaram

NEW DELHI: Terming demonetisation as “the most terrible mistake in India’s economic history”, former FM P Chidambaram has said that the government was now scrambling for cover after interrupting the Indian growth story by this move.

“Through the year, especially 2016 calendar year, or, 2016-17 financial year, you made a series of mistakes, capped by the most terrible mistake in India’s economic history, and, that is, demonetisation. As a result of that, you have interrupted the India’s growth story. You are struggling to find justification for what you did. You are fumbling, you are bumbling, you are scrambling, and you are inventing a new narrative every day,” Chidambaram said initiating the debate on the budget in the Rajya Sabha on Thursday.

He referred to the latest monetary policy announced by the RBI as a veiled disapproval of the budget presented after note recall.

“Yesterday, the Reserve Bank declined to cut the policy rate. Why? Please ask yourself, why?” Eight days after the Budget is presented, the RBI says, “no confidence in your Budget.”

If your budget projections were right, if your budget numbers were right, if your budget had credibility, if the people sitting in Mumbai believed the people sitting in Delhi, they would have cut the interest rate as well. They did not. Why? It is because they don’t believe your GDP numbers.

They don’t believe the kind of aggressive revenue projections that you are making. They don’t believe that you will achieve your expenditure targets. They don’t believe your fiscal deficit number,” Chidambaram said.