Monday, February 17, 2014

Chidambaram's last post for the UPA government, a political farewell for the 2004-2014 period

P.Chidambaram has always taken pride as UPA's finance minister. In the last Budget, the interim Budget, he presented on Monday, February 17, was quite a political farewell, where he recounted through figures the changes that have happened between 2004 and 2014, the time UPA has been in power. But no one showed any interest in what he had to say though he said it clearly and loudly in the Lok Sabha. And he also presented an outline, a wish list, of what the economy should be in the future.
The opposition, people in general, the media have already turned their back on Chidambaram and the UPA. They showed no interest in what he had to say though he had quite a few things to say. He said that there were clear signs of recovery and the lows of deceleration of 2011-2012 are now past.
The performance of the economy over the past decade has been impressive, and it can always be argued that it was not due to the genius of either prime minister Manmohan Singh or that of finance minister Chidambaram. The opposition parties are in no mood to give any credit to the duo or to the UPA.
It will take a year or two, once the heat and dust of the poll battle is settled, sometime in 2105 or 2106 for people to view the changes that have happened between 2004 and 2014.
Like a good partisan, Chidambaram had refused to acknowledge that any thing good has at all happened between 1998 and 2004 -- the years of BJP-led NDA in office -- and he has tried to emphasise the good things that had happened in the last 10 years. He relied on unreliable statistics to make his point, an economist's legitimate way of playing round figures.
He played the politician and the economist to the hilt when he said " Madam Speaker, I reject the argument of policy paralysis. Just as there are business cycles, there is a cycle around the trend growth rate of an economy. Over a period of 33 years, the trend growth rate in India has been 6.2 per cent. Average annual GDP growth during the period 1999-2004 was 5.9 per cent, that is below the trend rate. In the next five year period 2004-2009, it was 8.4 per cent and, in the period 2009-2014, gping by the CSO's estimate, it will be 6.6 per cent. UPA-1 and UPA-2 have delivered above the trend growth rate." Chidambaram should know and he is perhaps aware that this is an argument that will not win an election. UPA-2 has an image problem and all Chidambaram's lawyerly arguments are of no avail.
There is much that has happened in this decade on the economic front and much of it has been good. BJP's silly argument that it is a wasted decade is worthless political rhetoric as much as Chidambaram's silly argument to berate the economic growth rate between 1999-2004. It will always remain a mystery as to how much the irrational factor of a credible political leadership is important for kick-starting the economy and how the cowardly and unimaginative private sector and captains of industry could throw the economy into a soup.
The only thing that has to be said in favour of UPA is that Congress is capable of inspiring private sector much better than the supposedly pro-private sector BJP. The BJP seems to demand and direct private sector to do things instead of providing the ambience of freedom for the private sector to flourish.


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