Finance Minister P Chidambaram in an interview to P Vaidyanathan Iyer and Sunil Jain says that the UPA government maintained a fine balance between growth and equity to the extent possible, given the circumstances, and despite what its critics may say, the current set of challenges cannot be wished away by its successor.
Now that the economy is where it is, do you regret that we could have done some four-five reforms if we were at an earlier date, and what would those reforms be?
Of course. I think we should have pulled back on the monetary expansion at least a year earlier. What we have done beginning August 2012, I wish we had done it beginning August 2011. I can’t speak on labour reforms. It is very nice to talk about labour reforms. All those who talk about labour reforms when they are in the government, don’t try to implement labour reforms. All I can say is that all the measures we took on the fiscal side and on the monetary side, since August 2012, I wish we had done it earlier.
We would have given ourselves two years and six months to pull back the economy to the high growth path. What I had was only one year and six months. I can only speak for the fiscal side. I cannot speak for what other ministers ought to have done or what other ministers could have done. I can’t speak for that. I can only speak for what I have done since August 2012 and how I feel we should have done it earlier. What I have said in the Budget pertains to the finance ministry. Please look at the 10 points I made. Those 10 points pertain to the domain of the finance ministry.
When the next government comes, whoever that government is, what is the big constraint facing them? Will it be a banking crisis?
There won’t be any banking crisis. The big constraint will be resources. Unless we grow at a higher rate, we will not have the revenue resources, both tax and non-tax. That will be the big constraint. The forbidden solution to that is to borrow more. Just because there is a constraint on resources, one should not yield to the temptation to borrow more. While every effort must be made to augment resources, both tax and non-tax, we should keep expenditure within the limits allowed by continued…