Updated August 29th, 2020 at 13:34 IST
'What about before COVID-19?': Chidambaram slams FM Sitharaman over 'Act of God' remark
Chidambaram, in a series of tweets, questioned FM Nirmala Sitharaman, alleging mismanagement of the economy before the COVID-19 pandemic struck the country.
Advertisement
Finance Minister Nirmala Sitharaman's "COVID-19 is an act of God" comment has caught her in a storm of criticisms, latest among them is former Finance Minister and senior Congress leader P Chidambaram, who, in a series of tweets questioned her alleged mismanagement of economy before the COVID-19 pandemic struck the country. Taking a swipe on the finance minister, Chidambaram demanded answers from Sitharaman, calling her 'messenger of God'.
If the pandemic is an ‘Act of God’, how do we describe the mismanagement of the economy during 2017-18 2018-19 and 2019-20 BEFORE the pandemic struck India? Will the FM as the Messenger of God please answer?
— P. Chidambaram (@PChidambaram_IN)
Chidambaram in the following tweets alleged that the "Centre is absolving itself of any financial responsibility" amid the pandemic and said the entire financial burden has fallen on states.
The two options given by the Modi government to the States to bridge the GST Compensation gap are unacceptable
— P. Chidambaram (@PChidambaram_IN)
Under the first option the States are asked to borrow by pledging their future receivables under Compensation cess. The financial burden falls entirely on the States
— P. Chidambaram (@PChidambaram_IN)
Under the second option, States are asked to borrow from the RBI window. It is more market borrowing, only by a different name. Again, the entire financial burden falls on the States
— P. Chidambaram (@PChidambaram_IN)
The central government is absolving itself of any financial responsibility. This is a gross betrayal as well as a direct violation of the law
— P. Chidambaram (@PChidambaram_IN)
Subramanian Swamy slams finance minister's statement:
Even BJP MP Subramanian Swamy on Friday questioned Sitharaman for her statement pertaining to COVID-19 and the ensuing economic slump in the country.
The senior BJP leader lashed out at Nirmala Sitharaman and said that he will post the video of her statement soon. In addition, he also questioned whether the decline in annual growth rate from 8 per cent in 2015 to 3.1 per cent in the first quarter of 2020 before the pandemic should be attributed as an act of god as well.
I am reliably informed that FM N. Sitharaman told a meeting that COVID-19 is an act God!! I will post the video soon. Was the decline in annual growth rate in GDP from 8 % in FY 15 to (1st Qtr 2020) 3.1 % pre-C0VID, also an act of God ?
— Subramanian Swamy (@Swamy39)
READ | Finance Ministry Remembers Arun Jaitley For Historic GST Implementation, Pays Tribute
Finance Minister's comment of 'Act of God'
Criticisms from political leaders come as Sitharaman on Thursday said the economy has been hit by the COVID-19 pandemic, which is an 'Act of God', and it will see a contraction in the current fiscal. As per the Centre's calculations, states will be facing a shortfall of Rs 2.35 lakh crore in GST revenues in 2020-21.
"This year we are facing an extraordinary situation that even below 10 per cent approximate estimation you are facing an 'Act of God' which might even result in a contraction of the economy...," Sitharaman said.
Briefing reporters after the 41st meeting of the GST Council, Sitharaman said the Centre will pay the states the compensation which strictly arises out of GST implementation.
In the current fiscal, the compensation requirement of states has been estimated at Rs 3 lakh crore, of which Rs 65,000 crore would be funded from the revenues garnered by levy of cess. This leaves a shortfall of Rs 2.35 lakh crore.
The Centre has estimated that of this Rs 2.35 lakh crore, Rs 97,000 crore compensation requirement is due to GST rollout and the remaining is on account of the impact of COVID-19 on the economy.
Earlier this week, the Reserve Bank had said that the contraction in economic activity was likely to continue in the second quarter of the current fiscal as upticks witnessed in May and June appears to have lost strength following the reimposition of lockdowns to contain the coronavirus pandemic.
READ | Coronavirus LIVE Updates: India's Tally At 33.87 Lakh; Jharkhand Extends Current Lockdown
Advertisement
Published August 29th, 2020 at 13:34 IST