I feel sorry for the next finance minister, economy is in bad shape: P Chidambaram

The manufacturing output has turned negative; portfolio investments have turned negative, FDI is at its lowest point in five years. All other data will turn negative now. said P Chidambaram, Former finance minister, in an interview with ETNOW.

Edited excerpts:

Six phases of voting are over. Only one more left. How confident does Congress feel?

We are pretty confident that we have gained significantly at the expense of the BJP. Every seat lost by the BJP in Gujarat, Maharashtra, Rajasthan, Punjab, Madhya Pradesh, Chattisgarh, Jharkhand in the polls, is gain for the Congress.

People are talking about how the post poll alliances are going to work. The Congress Party was able to get a lot of pre-poll alliances in place with the RJD, the Jharkhand Mukti Morcha apart from that the NCP and other parties as well. How is the mechanics going to work with respect to post-poll alliances because time is going to be of essence here?

Our pre-poll allies are standing firm. There is not a doubt in our mind that the pre-poll allies will stand together and make a bid to form the government. Now as regards the other potential allies, they are really three or four main players, BSP, SP, Trinamool Congress and perhaps the two parties in Telangana and Andhra Pradesh. But I am confident that post poll, they will also realise that in order to form a non-BJP government, all of us have to come together. It is quite possible that each or more of them will make an effort to lead such an alliance but eventually the reality will hit everyone that all non-BJP parties have to stand together. We are prepared.

What will this preparation really entail? Will the Congress go the extra mile to cobble up that support? It could mean that the Congress Party may just have to put its pride behind?

Where is the question of pride here? We have made it absolutely clear that as far as we are concerned, unseating the BJP is the prime goal. Who will be prime minister is not very material.

All the data is pointing towards a consumption slowdown, weakness in the economy, a slowdown of sorts whether you look at the FMCG data or the auto data. Does that mean that the future of India is going to be blurry in the days to come?

Every indicator is pointing southward. I am sorry for the next finance minister. The economy is in bad shape. Every indicator from now until the results will again be southward. The manufacturing output has turned negative; portfolio investments have turned negative; FDI is at its lowest point in five years. All other data will turn negative now. The point is you will have to arrest the decline first, which means persons in office must inspire confidence. Today neither the prime minister, nor the economic team inspires any confidence.

Could this be a temporary blip because of election season, because… ?

Of course not, why should it be a temporary blip because loss of confidence is only indicative of loss of faith in the government. Their fiscal deficit is stuck at 3.5-3.4% and they have claimed in the revised estimate that 2018-19 will be 3.4%. It would not be. The tax collection is falling short by 11%. Who is to talk about the quality of fiscal marksmanship the BJP?

What about the issue of data credibility?

Government data today has zero credibility. Their employment data has zero credibility. The growth data has zero credibility. Their Swachh Bharat data has zero credibility. Their Ujjwala data has got zero credibility. This government’s data is hopelessly suspect. I have heard that a very eminent international economist spoke to one of my colleagues and said are we joining the group of countries like China? Can India’s data ever be relied upon?

Do you believe it is going to have a major impact on the investments?

It is already happening. Why is portfolio investment turning negative and why is FDI lowest in five years? Why is private investment lowest in five years?


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