Senior Congress leader P. Chidambaram on Saturday welcomed the Centre’s decision to borrow an additional ₹4.2 lakh crore, but cautioned that the money should be used to provide relief to the poor and restart the economy.
“After resisting our appeals, especially through statements of the Chief Economic Adviser, the government has finally decided to borrow an additional amount of ₹4.2 lakh crore, taking the projected fiscal deficit to 5.38%. We welcome the decision,” he said in a statement.
The government on Friday revised its gross market borrowing target from the estimated ₹7.8 lakh crore to ₹12 lakh crore in view of the COVID-19 pandemic. “The estimated gross market borrowing in the financial year 2020-21 will be ₹12 lakh crore in place of ₹7.80 lakh crore as per the budget estimates 2020-21. The above revision in borrowings has been necessitated by the COVID-19 pandemic,” the Finance Ministry had said in a statement.
Earlier, in a series of tweets, Mr. Chidambaram said that as the country went into lockdown, the Congress had asked the government to take care of the migrant workers. He said the party was the first to demand that cash and grain be given to the poorest 50% of the families. This measure would have covered the migrant workers, but the Narendra Modi government did not pay heed to the demand, he said. The party had also sought help for the migrants to return home. “Central government dragged its feet for 38 days,” he said.
As for the additional borrowing, Mr. Chidambaram said, “It is not enough to borrow more unless the amount is used to provide relief to the poor and re-start the economy. We look forward to the revised expenditure budget for 2020-21.” He said the budgeted fiscal deficit of 3.5% should not be a constraint in these extraordinary times.
