Chidambaram asks RBI Governor to 'bluntly tell government to do its duty, take fiscal measures'

Alphonse Joseph

New Delhi, May 23: Former finance minister and senior Congress leader P Chidambaram advised Reserve Bank of India (RBI) Governor Shaktikanta Das to "bluntly tell the government to do its duty and take fiscal measures" to decrease the national economy struggle due to coronavirus and its lockdown.

Taking to Twitter, Chidambaram said, "Governor @DasShaktikanta says demand has collapsed, growth in 2020-21 headed toward negative territory. Why is he then infusing more liquidity? He should bluntly tell the government Do your duty, take fiscal measures."

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On Friday, the RBI Governor admitted that growth will be in "negative territory" this year, the first time anyone in the government or the central bank has admitted that India's gross domestic product (GDP) will shrink this year.

The Governor cut the policy rate by 40 basis points to 4.0 per cent on May 22, acknowledging the adverse impact on the Indian economy of the coronavirus outbreak.

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Earlier, the former finance Minister had slammed Prime Minister Narendra Modi and FM Nirmala Sitharaman for the Rs 20 lakh crore relief package that has "fiscal stimulus of less than 1 per cent of GDP".

The Prime Minister had claimed that the relief package was worth 10 per cent of the GDP.

In another tweet, Chidambaram said, "Even after RBI's statement, is the @PMOIndia or @nsitharaman lauding themselves for a package that has fiscal stimulus of less than 1% of GDP?"

On Friday, while addressing a meeting of 22 like-minded parties, Congress president Sonia Gandhi also described PM Modi's May 12 announcement of the Rs 20 lakh crore stimulus package as a "cruel joke" on the country.

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