Former Finance Minister P. Chidambaram
Former Finance Minister P. Chidambaram
(PTI Photo/R Senthil Kumar)

New Delhi: Former Finance Minister P Chidambaram on Monday tore into Narendra Modi government's handling of the economy, saying it was "perilously close to a collapse" and was being attended to by "incompetent doctors".

The economy, he said, was facing twin problems of rising unemployment and falling consumption but the government continues to live in denial. Initiating the debate on the Union Budget for 2020-21 in the Rajya Sabha, Chidambaram said more money needs to be put in hands of people and not give "extraordinary powers" to junior taxmen to unleash "tax terrorism."

According to him, the economy was facing structural problems but the government continues to believe they were cyclical in nature. Modi government's chief economic adviser for four years, Arvind Subramanian, has stated that the economy is in the ICU (Intensive Care Unit). But "I would say the patient has been kept out of the ICU and incompetent doctors are looking at the patient," Chidambaram said.

"It is dangerous to have a patient out of the ICU and being looked upon by incompetent doctors. What is the point standing around and chanting slogan 'Sab ka Saath, Sab ka Vishwas'," he said.

The BJP government lives in denial, refuses to acknowledge its mistakes and has an "outdated" predisposition towards protectionism and a strong rupee, and is against bilateral as well as multilateral trade agreements, he said.

"We have an economy which is perilously close to collapse. It has to be attended to by very competent doctors. In the last few years, we have found the doctors are not so competent," he said.

"We are living in denial and we are ignoring two big elephants in the room -- one is rising unemployment and the other is fall in consumption. Unemployment rises, consumption falls, the Indian economy becomes poorer and not richer," he noted.

Chidambaram called demonetisation of old 500 and 1,000 rupee notes as well as the hurried implementation of a "flawed" Goods and Services Tax (GST) with wrong design, rates, structure and procedure and an unprepared system as "monumental blunders" that ruined the economy.

"Because of its refusal to admit mistakes, because it lives in denial, because of its predisposition, the government either does not know or if it knows is not willing to make it clear that this is the state of the economy," he said.

With an unprecedented six consecutive quarters of falling growth, the economy is facing demand constraints and is investment-starved, he said.

"When we point out the mistake of the government, the government must have an open mind to debate and if it is a mistake, admit it." "It is living in denial. It simply does not accept that the state of the economy is extremely bad," Chidambaram said.

"Who are your doctors?, I want to know," he said, adding the government considers Congress as an untouchable and does not think of any good about the rest of the Opposition and so doesn't consult them.

Chidambaram charged that instead of putting money in the hands of people, the Modi government "puts money in hands of 200 corporates" by way of cut in corporate tax. Stating that every competent doctor that the Modi government could ever find has left the country, he listed out former RBI governors Raghuram Rajan and Urjit Patel, former CEA Arvind Subramanian and former NITI Aayog Vice Chairman Arvind Panagariya as persons who quit during the BJP rule.

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