In a sequence of tweets, Chidambaram stated, “RBI Governor says demand has collapsed, development in 2020-21 headed towards detrimental territory. Why is he then infusing extra liquidity?”
The previous minister in his subsequent tweet additionally stated that Shaktikanta Das ought to bluntly inform the federal government — “Do your responsibility, take fiscal measures.”
“Even after RBI’s assertion, is the Authorities or Finance Minister (Nirmala Sitharaman) lauding themselves for a bundle that has fiscal stimulus of lower than 1 per cent of gross home product (GDP)?” he stated.
Slamming the Rashtiya Swayamsewak Sangh (RSS), Chidambaram stated, “RSS ought to be ashamed of how the federal government has dragged the financial system into detrimental development territory.”
His remarks got here a day after the RBI delivered an emergency fee reduce for the second time in as many months on Friday because it judged that the Covid-19 pandemic poses a grave risk to the nation and can result in the primary financial contraction in 40 years.
Das on Friday introduced a 40 foundation factors (bps) reduce in repo and reverse repo charges, whereas markedly pivoting the central financial institution’s focus from inflation management to fostering development. Das pledged to take no matter “measures are vital” to satisfy the challenges posed by the pandemic.
He additionally stated that India’s GDP development fee for the monetary yr 2020-21 is more likely to be within the detrimental territory.