Former finance minister P Chidambaram today expressed his disapproval of the first tranche of the Rs 20 lakh crore fiscal stimulus announced by Union finance minister Nirmala Sitharaman. "Except for modest MSME package, we are disappointed with announcements," said Mr Chidambaram, who handled the finance portfolio in the UPA government led by Manmohan Singh.
The Centre has announced Rs 3.6 lakh crore in the Rs 20-lakh crore package. Where is the rest of Rs 16.4 lakh crore?" the former minister was quoted as saying by news agency Press Trust of India.
Ms Sitharaman today said the contour of the Rs 20 lakh crore package will take several days to unveil.
Fifteen different measures, involving the MSMEs (Micro, Small and Medium Enterprises), NBFCs (Non-Bank Financial Companies), MFIs (Micro Finance Institutions), Provident Fund, Real Estate and Taxation, were announced today.
The big takeaways include collateral-free automatic loan worth 3 lakh crore for MSMEs, the bar on global tenders upto Rs 200 crore, a reduction in the employers' contribution for Employees Provident Fund, Rs 90,000 crore one-time Infusion of liquidity for discoms and an extension of upto six months for contractors working with the Central government.
Asked about the fiscal deficit in present GDP, Mr Chidambaram told NDTV that the fiscal deficit needs to be "given a go". "It will be around 5.3 or so and Congress supports monetising of fiscal deficit like eminent economists have argued," he said.
"The government must spend more, borrow more, and allow states to borrow more. But it is not willing to do so. This government is a prisoner of its own ignorance and fears," PTI quoted Mr Chidambaram as saying. .
He also highlighted the other big criticism of the Congress since PM Modi's address to the nation yesterday – that there was no word on migrant labourers, whose plight had made headlines through the seven weeks of lockdown.
"There is nothing in what the Finance Minister said, for lakhs of poor, hungry migrant workers who have been walking to their homes. This is a cruel blow to those who toil every day," said the senior leader of the Congress, which, while in power, had laid special emphasis on welfare measures.
Even this morning, Mr Chidabaram had warned that he would keep a sharp eye on "who gets what".
"And the first thing we will look for is what the poor, hungry and devastated migrant workers can expect after they have walked hundreds of kilometres to their home states," one of his tweets read.
"We will also examine what the bottom half of the population (13 crore families) will get in terms of REAL MONEY," read another tweet.
The Left parties too, called the budget a "farce" saying the migrant labourers who need help the most were bypassed.
"We are witnessing the pettiest form of politics from Modi govt. There is nothing for the state govts which have been asking for funds, as they are at the forefront of fighting the pandemic. Nothing for them, not even their legitimate dues!," tweeted CPIM general secretary Sitaram Yechury.
Scathing criticism came from Bengal Chief Minister Mamata Banerjee, who called it a "big zero" and an "eyewash". "There is nothing for the unorganised sector, public spending and employment generation," she said.
Tamil Nadu's opposition DMK also said the package has nothing for the poor and the middle class who have been "let down" by the Centre. Party chief M K Stalin also questioned why there was no allocation to the states, which have repeatedly asked for financial assistance from the Centre. There was no link between what PM Modi announced on Tuesday and the specifics explained by Finance Minister Nirmala Sitharaman today, Mr Stalin said in a statement, reported news agency Press Trust of India.
Yesterday, in his address, Prime Minister Narendra Modi had assured that the package will be all-inclusive and cater to all sections of the society.
"The package will focus on land, labour, liquidity and law; it will help small businesses, labourers, farmers, the middle class and cottage industries. It will focus on the well-being of migrant workers too," said the PM.
In her tweets, Ms SItharaman said the "Atma-Nirbhar Bharat" mission will not not just be a financial package. It would be a "reform stimulus, a mindset overhaul, and a thrust in governance," her tweet read.