Finance Minister Nirmala Sitharaman is currently in the US and some of her statements there had created a stir with former PM Dr Manmohan Singh retorting that she should stop blaming the UPA government for the present ills in the economy. Sitharaman has now responded to this by saying that she was not blaming anybody but was only alluding to the actions in the past which are having repercussions even now.
She referred to the public sector banks having resorted to indiscriminate lending during the period Dr Manmohan Singh was the PM and Raghuram Rajan the Governor of RBI. A majority of those loans turned NPAs and in some cases borrowers fled the country fearing action by the agencies. “I don't need to put the blame — it’s more than apparent as to when the wrongdoings happened in the banks and which is the government which is spending time to clear the clog from the public sector banks,” was her response.
The NDA government has had to first identify the bad loans and bring it out. Subsequently, the banks had to be recapitalized and now the situation is limping back to normal. In the meantime, if there has been a weak credit offtake due to lenders exercising more caution or for other reasons, then it will take time to recover.
The Finance Minister also answered a few questions put to her by the media at the US event. She said she is not looking at any timeframe within which the economy will get back to the higher growth path climbing back from the 5% low it has touched. She had earlier reacted to the IMF revising the estimate of India’s GDP growth this year to 6.1% by saying that even at that rate India’s growth should be considered one of the fastest in the world.
Nirmala Sitharaman says her announcements after meeting the various business segments need not be seen as part of any focused move to push growth etc. She claims she is just listening to the ideas from each sector of the industry and business and knowing what they want the government to do and wherever and whatever was feasible it was being done. It is then left to the industry to take it forward.
The FM was quite confident about the government being able to mop up the targeted Rs 1,05,000 crore through disinvestments. She felt the market response so far was positive.
She repeated her earlier optimism that the Indo-US trade deal will come through though delayed. Serious discussions are underway and the differences being narrowed down.