Chidambaram says Centre’s measures to halt the weakening of the rupee are ‘half-hearted’
The former finance minister also sarcastically said that the government must have found a crude oil source that will supply it for free.
Congress leader and former Union minister P Chidambaram on Saturday said the measures taken by the Narendra Modi-led government to stop the depreciation of the rupee were “half-hearted”. “Government’s five ‘measures’ announced yesterday are half-hearted and too late,” Chidambaram tweeted. “Because government was in denial.”
The former finance minister said the worsening of the current account deficit was obvious for a long time, but the Centre did not act. “The slide in the current account Deficit, Foreign Portfolio Investment outflow, the weakening rupee and the depletion of forex reserves were wake up calls that were ignored,” he said.
The current account deficit is the difference between the worth of a country’s imports and its exports. A higher deficit means the country buys more products from overseas than it ships out as exports.
Chidambaram also sarcastically said that the Centre must have found a crude oil source that will supply it for free. “Government says will not cut fuel prices,” he tweeted. “BJP President [Amit Shah] says ‘Centre will soon arrest fuel prices’. BJP must have found a crude oil source that will supply crude oil free!”
Finance Minister Arun Jaitley said on Saturday that the government was confident of meeting the fiscal deficit target. “The government so far has spent 44% of the budgeted capital expenditure and there will be no cuts in capital expenditure by the end of this year,” he said.
Jaitley’s comments came after an internal review meeting of all the departments of the finance ministry chaired by Prime Minister Narendra Modi in New Delhi.
After a meeting on Friday, the government decided to relax norms for overseas borrowing and impose restrictions on non-essential imports. Jaitley said these moves will help check the current account deficit as well as increase foreign exchange inflows, without specifying which items would face import restrictions.