The Modi government handled the economic crisis better during the pandemic than the UPA in 2008-09: FM | Latest India News

The Narendra Modi government handled the Covid-induced economic crisis in 2020-21 better than the Congress-led UPA government handled the global financial crisis in 2008-09, as it managed to contain inflation at 6, 2% of GDP despite an unprecedented contraction of against 9.5% for fiscal 2009, Finance Minister Nirmala Sitharaman told parliament on Thursday.

Beginning her response to comments and questions raised during the budget debate in the Lok Sabha, she said that the Congress regime was the “andh kaal”. [dark age] because of rampant corruption, scams, middlemen, double-digit inflation and political paralysis. Sitharaman was referring to opposition remarks at the start of the debate calling it “Azadi ka Amrit Kaal” [the 25-year lead-up to India at 100] in his budget speech as “andh kaal”.

Reporting on the Modi government’s financial inclusion programs, basic equipment programs and direct cash transfers to farmers and the poor, the minister said it was definitely “amrit kaal”.

She said that the financial crisis due to the Covid-19 pandemic that hit India in March 2020 was a global phenomenon, and compared it to the financial crisis of 2008 which also negatively hit the Indian economy during UPA rule. While this crisis has led to a sharp drop in gross domestic product (GDP) to the tune of 2.21 lakh crore in 2008-09, the growth rate did not slip into negative territory.

“But, what we saw from the pandemic in 2020-21, which led to a contraction of 6.2%, was one of the worst we have ever faced and we were not alone in this. this case… I just like to draw a comparison between what the economy was like then [2008 global financial crisis]…and what is the economy now… Compared to that, the lost GDP is now 9.57 lakh crore, so that’s the scale we had lost in this pandemic compared to recently, meaning a global financial crisis ten years ago,” Sitharaman said.

“Despite significant supply-side disruptions, CPI inflation in India was 6.2% in 2020-21 from 9.1% in 2008-09,” she said, adding that the government had contained consumer price inflation (CPI) well below the prescribed limit. She said the government is still trying to calm commodity prices through various measures, including importing items such as edible oil. The official prescribed limit for CPI inflation is 4% (plus/minus 2%).

Attacking the former Congress government for the Bali deal at the World Trade Organization (WTO), Sitharaman said: “They [had] sold the right to supply and MSP [minimum support price” in 2013 that could have a detrimental impact on food security of the country. The Narendra Modi government in 2015-16 reversed it so that the government’s food procurement programmes continue and it would be able to supply subsidised grains to the poor, she said.

Also Read | Cong, DMK & IUML walk out during Nirmala Sitharaman’s reply in Lok Sabha

She blamed the Congress government for the sickness of state-run telecom firms BSNL and MTNL. “Revival of BSNL is thanks to Prime Minister Modi, and I will tell how,” she told the Lok Sabha. BSNL was formed in 2000 and there was an agreement at that time that the annual licence fee will be reimbursed till 2010, but in 2006, the UPA government stopped paying the reimbursement. “I’m telling gradually, why BSNL came to the verge of ICU [intensive care unit]…reason of Congress,” she said.

“Second, …in 2010, MTNL was suddenly told to pay the auction price for wireless broadband access. Until then, MTNL, which was a cash-rich company, suddenly had to pay 11,000 crores because overnight MTNL became a loss-making company,” she said. “Kill BSNL slow, kill MTNL, it happened in 2010,” she added in Hindi.

She also accused the then government of postponing the February 2014 decision to grant annual financial support. She said BSNL was harmed by delaying the bidding process for its 93 million line expansion plan in 2006, 2008 and 2010. She said BSNL’s market share went from 19 % in 2005 to 7.96% “due to their non-cooperative measures”. .

On the criticism that the government is placing too much emphasis on capital spending in the budget at a time when it should be boosting consumption, Sitharaman said the return on 1 spent on revenue expenditure was 45 paise, while 1 spent on infrastructure generates a return of 2.45 the first year and 3.14 thereafter for two more years.

Justifying the increase in tariffs on umbrellas from 10% to 20%, she said it was done to protect domestic small and medium-sized businesses as India was inundated with “25 million umbrellas from a single country”. Although she did not mention the name of the country, officials said said country is China which sells umbrellas in India.

During the budget response, Congress Leader Adhir Chowdhury and other MPs frequently protested and commented. Union Minister Narendra Singh Tomar intervened and claimed that Chowdhury was receiving instructions from outside and acting accordingly. “He looks into his phone and tries to talk every time,” Tomar said.

Earlier during the debate, Chowdhury said selling Air India would create a duopoly between the Tata Group and IndiGo. He also called the target of 400 Vande Bharat trains unrealistic and citing reports, said that while the Modi government had promised two crores of jobs a year, more than 12 crores had lost their jobs since the start. of the pandemic. Chowdhury denounced the high fuel prices and said the government had no road map because there was no road.

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