P Chidambaram Shreds Economic Package, Says Many Left 'High And Dry'

P Chidambaram urged the government to reconsider the economic stimulus package.

New Delhi:

The government’s mega relief package worth over Rs 20 lakh crore for the coronavirus-hit economy “has left several sections high and dry”, former Finance Minister and senior Congress leader P Chidambaram said today.

Calling the announcements made by Finance Minister Nirmala Sitharaman a “thorough disappointment”, he urged the government to reconsider the stimulus.

“…a fiscal stimulus of Rs 1,86,650 crore amounting to barely 0.91 per cent of GDP will be totally inadequate given the gravity of the economic crisis and the dire situation in which people find themselves,” Mr Chidambaram said in a statement.

He urged the government to announce a revised package  of “not less than Rs 10 lakh crore of real additional expenditure equivalents to 10 per cent of GDP”.

Mr Chidambaram also accused the government of bypassing parliament and a discussion on the package. “I think government is deliberately sidelining parliament. The government is being opportunistic by pushing reforms, it is bypassing discussion in parliament and this will be resisted,” the Congress leader said.

“There is no response from the presiding officers regarding parliament. They are citing some rules not to permit the meeting. We can’t hold a virtual dharna (protest). We are trying to raise our voices,” he added.

Over the last five days, Ms Sitharaman had  unveiled the finer details of the fiscal stimulus in five phases after Prime Minister Narendra Modi last Tuesday announced a Rs 20 lakh crore special economic package, equivalent to 10 per cent of India’s GDP, for the country to become ”self-reliant” and deal with the COVID-19 crisis.

In the first tranche worth Rs 5,94,550 crore, the government announced some big measures such as loan guarantees worth Rs 4.5 lakh crore to help Micro, Small and Medium Enterprises (MSMEs), non-banking financial companies and power distribution firms access collateral-free loans from banks.

In the second briefing, for the tranche worth Rs 3,10,000 crore, Ms Sitharaman said that millions of migrants will be provided free food grains for the next two months. Rs 3,500 crore will be spent on food for nearly eight crore migrant workers, Finance Minister Nirmala Sitharaman said.

In the third round of announcement, as a part of third tranche – worth Rs 1,50,000 crore – the government declared a fund Rs 1 lakh crore to strengthen farm-gate infrastructure and aggregators like Farmers’ Producers Organisation, agricultural entrepreneurs and primary agriculture cooperative societies.

The announcements of Day 4 included reforms to eight sectors, including a 25 per cent increase in FDI in the defence sector and removal of government monopoly on coal mining. The government also proposed easing of restrictions on Indian airspace.

On Sunday, in the final set of announcements. Ms Sitharaman announced a big boost in spending on the MNREGA scheme, an upped borrowing limit for states, more relaxations for private players and big changes for health and education sectors.