Business Today
PTI feed

Cong hits back at Jaitley over criticism of RBI

twitter-logo PTI        Last Updated: October 30, 2018  | 20:57 IST

New Delhi, Oct 30 (PTI) The Congress on Tuesday accused the government of "destroying" institutions in the country by "assaulting their autonomy" as it hit out at Finance Minister Arun Jaitley over his criticism of the RBI and demanded that he apologise. Senior Congress leader Anand Sharma accused Jaitley of "interfering" in the functioning of the Reserve Bank of India and alleged that the government was seeking to take charge of the country's monetary policy, a domain of the RBI. There was no immediate comment from Jaitley or the government on the Congress' charges. "We demand from this government to desist from destroying another autonomous institution, to retract their steps, engage in dialogue and consultations rather than seeking to justify what is patently wrong and unjustified," he told reporters. The Congress leader expressed surprise at the sharp attack of the Finance Minister on the RBI and its performance. "The central bank is independent and autonomous. It is in the interest of the Indian economy that the Reserve Bank alone remains the regulator for the Banks for the lending, for borrowings and fixes the rates for the banks. Only the Reserve Bank must have the powers to regulate the Public Sector Banks and none else. "This government has ignited a fire through its repeated interference from day one and now it is the government’s move to take charge of the Monetary Policy, is an ominous move. It cannot be accepted, it must be opposed. Government being a spending authority cannot become the monetary authority for the country," he said. Sharma demanded that Finance Minister Jaitley apologise for "attacking the RBI and seeking to infringe upon its independence". His remarks came after Jaitley strongly criticised the RBI for failing to check indiscriminate lending between 2008 and 2014, when the Congress-led UPA was in power, and blamed it for the present bad loan or NPA crisis in the banking industry. The remarks by Jaitley came amid reports of mounting tension between the finance ministry and RBI after the central bank's Deputy Governor Viral V Acharya in a speech on Friday warned that undermining autonomy and independence of RBI could be "potentially catastrophic". Jaitley said between 2008 to 2014 after the global economic crisis, to keep the economy artificially going, banks were told to open "your doors and lend indiscriminately". "The central bank looked the other way, there was indiscriminate lending," he said. "I am surprised that at that time the government looked the other way, the banks looked the other way. I don't know what the central bank was doing (because) it was the regulator of these. They kept pushing the truth under the carpet." Sharma hit back at Jaitley accusing him and the prime minister of having "failed" the country's economy. "Both he (Modi) and his Finance Minister have proved to be not only inefficient but thoroughly incompetent when it comes to managing of the Indian economy, which has been nose-diving. "There has been flight of capital which has forced the situation to ensure that we borrow some extra money," he alleged, adding that almost USD 32 Billion (close to more than Rs 3 lakh crore) has flown out of the country. "Under Modi and BJP, they are damaging all the independent institutions of the country which have their role in maintaining governance and administration like CBI, ED, IT, DRI, central universities and many others," he alleged. Sharma alleged that RBI Governors have been "far more competent" than Arun Jaitley or Narendra Modi and when eminent economist Manmohan Singh was prime minister. The Reserve Bank played a stellar role as it ring-fenced the Indian economy and the big economies all over the world took note of India’s Central Bank’s functioning during the global economic crisis. "This is something which was acknowledged by the emergency meetings of G20 heads of state and government," he said. Saying that "the RBI is not competent, not capable, is the most unfortunate thing. I demand that Jaitley take his words back and apologise for insulting the RBI," Sharma said. He said that this was not the first time the government has interfered in the RBI and the first example was demonetisation when on November 8, 2016, 85 per cent currency was invalidated by the Prime Minister. "That was the first biggest attack on the RBI when it was forced in a board room to take that step," he alleged. Sharma also slammed the government over the depreciating Rupee, which has lost 16 per cent of its value since January this year and alleged that it was a big contradiction to the claim of fastest growing economy. PTI SKC RT

  • Print

A    A   A