The Narendra Modi-led BJP government brought transparency and pursued a balanced approach to fiscal consolidation while sustaining economic growth, Finance Minister Nirmala Sitharaman said on Monday.
Slamming the Congress for hiding behind non-transparent lofty promises of giving money ‘khata khat’ if voted to power in the 2024 general elections, Sitharaman observed that the underlying deficit was much higher than the budgeted deficit under the Congress-led UPA government.
“UPA Govt did ‘window dressing’ to hide its high fiscal deficit without maintaining the integrity of the fiscal numbers. Fiscal Deficit for 2008-09 would have been 7.9% instead of 6.1% as officially stated,” she said on a post on ‘X’. The Congress was in power from FY05 to FY14.
“If you are below the poverty line then every year, Rs 1 lakh khatakhat khatakhat aata rahega aur ek jhatke se hum Hindustan se gareebi ko mita denge (eradicate poverty instantly),” Congress leader Rahul Gandhi said recently seeking votes for his party.
Giving an account of the poor fiscal management by Congress, Sitharaman said the Centre’s debt rose 3.2 times during ten years of UPA whereas it grew 2.9 times during the BJP-led NDA despite the impact of Covid. The BJP is in power since FY15.
“Have they calculated how much the ‘Khata Khat’ schemes will cost fiscally? Will they borrow substantially for them, or will they raise taxes to fund them?” she asked.
“How many welfare schemes would @RahulGandhi shut down to accommodate the fiscal cost of the ‘Khata Khat’ schemes?” she wondered.
In the interim budget, the Modi-led BJP government has projected a further reduction in fiscal deficit to 5.1% of GDP in FY25. The deficit had hit a record high of 9.2% in the Covid-hit FY21. Similarly, the Central Government’s debt-to-GDP ratio fell from 61.4% in FY21 to 57.1% in FY24. It was 52.2% in 2023-14.
The UPA government issued special bonds instead of cash subsidies to the Oil Marketing Companies (Oil Bonds), fertiliser companies, and Food Corpotration of India to keep the official deficit numbers lower, she said. “Over Rs 1.9 trillion was kept off the books in the five years from FY 2006 to FY 2010. Including these off-budget borrowings would have severely increased the fiscal and revenue deficit numbers,” she added.
The Modi government managed to cut its fiscal deficit even after bringing nearly Rs 5 trillion off-Budget liabilities into the balance sheet by FY22.
