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Nirmala Sitharaman says Indian Public Sector Banks saw “Worst Phase” Manmohan Singh-Raghuram Rajan era

Nirmala Sitharaman pointed out that the “Combination” of Dr Manmohan Singh and Raghuram Rajan made the banks endure their “Worst Phase”. 


New Delhi| Two days after Indian Political economist and husband of the Finance Minister, Parakala Prabhakar blasted the BJP government for not having its own economic policy, Nirmala Sitharaman has hit back. Prabhakar in his op-ed for The Hindu also said that BJP govt should adopt “Rao-Singh” economic policy that was introduced by the duo in 1991. His criticism of the government gained a lot of steam as it came from the unexpected quarter.

Also Read: “We are talking of $5 Trillion economy when GDP growth going down”: Manmohan Singh

However, Nirmala Sitharaman has retorted saying that Banks saw the worst phase during Manmohan Singh-led UPA government. She said that a massive amount of bad loans mounted on the public sector banks during the tenure of Dr Manmohan Singh as India’s Prime Minister. Sitharaman pointed out that the “Combination” of former PM of India Dr Manmohan Singh and former governor of RBI Dr Raghuram Rajan made the banks endure their “Worst Phase”.

Nirmala Sitharaman was speaking at Columbia University’s School of International and Public Affairs on Tuesday. She said-

“I am placing the fact before you that Indian public sector banks did not have the worst phase than when the combination of Singh and Rajan, as Prime Minister and the Governor of Reserve Bank, had. At that time, none of us knew about it.”

The former RBI governor Raghuram Rajan has been a fierce critic of the Modi government’s economic policies. Recently, he had said that the first term of the Modi government saw a centralised leadership and there was no consistent vision as to how to achieve economic growth.  Responding to a question about this, she said that it was during his tenure as RBI governor that “loans were given just based on phone calls from crony leaders”.

Finance minister Nirmala Sitharaman has come under fire as the signs of Economic Slowdown are being visible more and more. The government has announced certain measures in the past months but the critics have pointed out that the packages announced by the government are not enough to avert the crisis.

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