Chidambaram Welcomes Centre's Decision to Borrow Additional 4.2 lakh cr

Senior Congress leader P Chidambaram on Saturday, 9 May 2020 welcomed the Centre's decision to borrow additional 4.2 lakh crore and said it should be used to provide relief to the poor and re-start the economy. "After resisting our appeals, especially through statements of the CEA, the government has finally decided to borrow an additional amount of Rs 4.2 lakh crore taking the projected fiscal deficit to 5.38 per cent. We welcome the decision," he said in a statement.

The senior Congress leader, however, said, "It is not enough to borrow more unless the amount is used to provide relief to the poor and to re-start the economy. We look forward to the revised expenditure budget for 2020-21."

Echoing similar sentiments put forth by several eminent economists, he had appealed to the central government to shed its reservations and borrow more in 2020-21

"In our view, the budgeted fiscal deficit of 3.5 per cent should not be a constraint in these extraordinary times," he said in the statement.

The government on Friday, 8 May 2020 revised its gross market borrowing target from the estimated Rs 7.8 lakh crore to Rs 12 lakh crore in view of the coronavirus pandemic.

"The estimated gross market borrowing in the financial year 2020-21 will be Rs 12 lakh crore in place of Rs 7.80 lakh crore as per BE 2020-21. The above revision in borrowings has been necessitated on account of the COVID-19 pandemic," the Finance Ministry had said in a statement.