Chidambaram says market rally due to UPA govt, dismisses Modi factor

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New Delhi, March 30, 2014: A stable UPA government and steps taken by it were responsible for market rally and not some kind of "hope", Finance Minister P Chidambaram has said, dismissing suggestions that propect of a Narendra Modi-led government after polls could be responsible for it.

"The rally is due to the fact of a stable government... not because of some kind of fond hope," he said and hit out at Narendra Modi, saying he is known to favour "crony capitalism."

 

In the last 18 months, government has taken a number of measures to strengthen the economy, Chidambaram told a news channel in an interview.

"We have contained the fiscal deficit, we have contracted the current account deficits substantially, we have added to our reserves, we have tamed inflation. I only wish that the firm hand on a wheel can continue for some time."

He refuted that the BJP’s Prime Ministerial candidate is seen to be growth oriented.

"Even Modi won’t make such an extravagant claim.... It’s obvious that big business and I am using the word big with capital B. Big business is supporting the BJP but that’s because Mr Modi is known to favour crony capitalism."

He added that the hallmark of UPA government is growth.

"We delivered 8.5 per cent growth in the first five years and we have delivered 7.2 per cent growth in the next four years. The NDA record does not even match 7.2 per cent," Chidambaram said.

"In hindsight, what we did in 2009 was right but perhaps, perhaps, we should have pulled back beginning 2011, the pullback started only after I returned to the Finance Ministry in August 2012 and we have shown result, if we had pulled back a year earlier these results would have been visible even last year," he said when asked whether there is a mistake which he as Finance Minister thinks the UPA should have never committed.

On the Vodafone tax issue, "Well I have explained it is not a retrospective tax, it is a clarificatory amendment that has retro-active operations. I think there is a vast difference in law between retrospective tax and clarificatory amendment which has a retro-active application.

"...Because of the perception that it is a retrospective tax, we have offered conciliation - it is Vodafone which is turning down the request for conciliation."

Slamming AIADMK chief and Tamil Madu Chief Minister J Jayalalithaa, Chidambaram said it is a pity that she does not even know what is happening in her state.

"I wonder what her intelligence department is doing, what her district administration is doing. We have published what we have done in this constituency. If she believes what she says, it means that the Chief Minister is completely cut off from reality, that she is ignorant of central government projects."

He added that she is ignorant of the central government records in Tamil Nadu. "I wish she will travel by road, she will travel by rail, then she can see what’s happening on the ground."