New Delhi: Former Finance Minister and senior Congress leader P. Chidambaram on Tuesday said that 2020-21 has been the darkest year of the economy in four decades and that the government should print more money if necessary as suggested by several economists, including Nobel Laureate Abhijit Banerjee.
“We may note that Banerjee has called for printing more money and increasing the spending, though Finance Minister Nirmala Sitharaman in her recent interviews to various newspapers defended the government’s misguided and disastrous policies.”
Earlier addressing a press conference, Chidambaram virtually attacked the government over the GDP numbers.
He said, “As expected, the GDP at constant prices recorded a negative growth of (-) 7.3 per cent, the first time India has recorded negative annual growth since 1979-80.
“2020-21 has been the darkest year of the economy in four decades. The performance in the four quarters of 2020-21 tells the story. The first two quarters witnessed a recession (-24.4 and -7.4 per cent). The performance in the third and fourth quarters did not herald a recovery.
The estimated rates of 0.5 per cent and 1.6 per cent were due to a very low base of 3.3 and 3.0 per cent in the corresponding quarters of the previous year. Besides, these rates come with a number of caveats,” the senior Congress leader added.
Chidambaram alleged that when the first wave of the Covid pandemic appeared to subside last year, the Finance Minister and her Chief Economic Adviser began to sell the story of a recovery.
“They saw “green shoots” when no one else did. They predicted a V-shaped recovery. It was a false story and we had expressed our strong reservations and warned there were no signs of a recovery. We had pointed out that what the economy needed was a strong dose of stimulus, including increased government expenditure, direct transfers of cash to the poor and liberal distribution of free rations. Our pleas fell on deaf ears, and the result is a negative growth of (-) 7.3 per cent.”
