White paper triggers govt-opposition clash

Union finance minister Nirmala Sitharaman. (Photo: ANI)
Union finance minister Nirmala Sitharaman. (Photo: ANI)

Summary

  • The debate over the economic track record before and after 2014 highlighted major shocks that India’s economy underwent under both regimes.

NEW DELHI : The ruling National Democratic Alliance (NDA) government and the opposition Congress party locked horns on Thursday, over a paper tabled in the Lok Sabha by finance minister Nirmala Sitharaman accusing the previous United Progressive Alliance regime of undermining the country’s macroeconomic fundamentals, and the Congress hitting back at the government citing price rice and unemployment.

The debate over the economic track record before and after 2014 highlighted major shocks that India’s economy underwent under both regimes, how the respective governments dealt with them, the effectiveness of the fiscal stimulus, given as well as the persisting issues of price rice and job creation not being commensurate with the demand from a large working age population.

The government’s white paper accused the UPA of excessive revenue spending, misguided stimulus, high fiscal deficit, inflation, failure to sustain reforms and political interference in commercial lending decisions of state-owned banks leading to toxic assets in the banking system. Following this, Congress president and Rajya Sabha member Mallikarjun Kharge released a document that he described as a ‘black paper’ titled ‘anyay kaal (unjst era) 2014-24’ accusing the NDA government of rampant unemployment, economic blunders, price rise of essential items like cooking gas, milk and flour, distress among farmers, stagnant wages, social disharmony and low labour force participation.

The government’s white paper said that the NDA regime has overcome every challenge of the pre-2014 era through its economic management and governance. “These have placed the country on a resolute path of sustained high growth. This has been possible through our right policies, true intentions, and appropriate decisions," the white paper said.

“The Modi government’s tenure is marked by high rates of unemployment, economic catastrophes such as demonetisation and flawed GST, which have only increased the divide between the rich and the poor and devastated the future of millions of farmers and daily wage workers," the document brought out by the Congress said.

Both administrations had to deal with major shocks—the global financial crisis of 2008 and the covid pandemic that broke out in 2019, which impacted the exchequer.

Experts said it is not the size of the economy or the magnitude of government’s fiscal deficit that should be the barometer to assess the performance of an administration but how it makes meaningful difference to the well-being of people.

“It has to be measured from the perspective of the citizens. They want to be able to participate in the growth of the economy with dignity and be able to be on their feet, which means they want their incomes to increase," said former Planning Commission member Arun Maira.

Maira explained that less than 5% of the people work in formal jobs and formal organizations and even there, wage increases at the bottom are falling way behind the increase in compensation of the people at the top. “It’s very clear all over the world that the benefits of growth have not been trickling down," said Maira. He said that the track record of different governments in improving incomes of the people at the bottom of the pyramid at a fast pace, has not been different.

The debate comes as the last Parliament session under the current government draws to a close ahead of national polls. Confident of a return to office for the third term on the back of inclusive growth and efficiency in social transfers and running of welfare schemes, the NDA government has refrained from announcing major populist measures in the interim budget for FY25 presented on 1 February.

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