Macro instability due to UPA policies, says Arun Jaitley

New Delhi: Arun Jaitley, on Sunday, blamed the policies of Congress-led UPA  government for India’s macro instability and equating it to poor quality of growth.

During the UPA regime, “fiscal discipline was compromised and the banking system was advised to go in for reckless lending notwithstanding the fact that it would eventually put the banks at a risk. And yet when the UPA moved out of power in 2014, the last three year record, even in terms of growth, was less than modest,” Mr Jaitley wrote in Facebook.

The comment come after a committee constituted by the National Statistical Commission in a report last week said that the economy clocked a 10.08 per cent growth rate in 2006-07 under the then PM Manmohan Singh, the highest since liberalisation of the economy in 1991. This has resulted in a heated debate between Congress and BJP as the report comes a year ahead of the Lok Sabha polls.

However,  the Ministry of Statistics and Programme Implementation (MoSPI) said on Sunday that “these are not official estimates” and the data will be released officially later. National Statistical Commission (NSC) too said the methodology for back-casting GDP series is “work in progress” and yet to be finalised.

Mr Jaitley said that the high growth witnessed during the UPA’s  reign should be seen  in the global context as all economies were growing during the boom years, which was not peculiar only to India. “However, post 2014, when the global economy was in slowdown mode, it was India and India alone which has been the fastest growing economy in the world for the last four years and has consistently overtaken China in the growth rate,” the Union minister wrote.

Mr Jaitley said that the UPA government in 2004 inherited an 8 per cent plus growing economy from the previous NDA government. “The global tailwinds supported India. Emerging markets were all growing at a higher rates and when the challenge emerged, it compromised on all macro fundamentals. It compromised on the fiscal deficit and the Current Account Deficit, it allowed inflation to spiral out of control and more so to create an illusory growth, it compromised India’s banking system through reckless lending,” he said.  

He also pointed out that the number projected by the committee are yet to be approved by the advisory committee on National Accounts Statistics.

Mr Jaitley also said that 2003-04 witnessed the boom period for the global economy which continued till 2008 when the global crisis started.