Attacking Congress, Finance Minister Arun Jaitley today said the previous UPA government had indulged in discretionary allocation of national resources causing damage to the economy and the Modi dispensation did away with the practice as it learnt from their "mistakes".
Replying to a debate on Budget in the Lok Sabha, he also said the Manmohan Singh government had focussed on redistribution of resources without enhancing growth and productivity.
Jaitley, while noting that recession had hit the global economy in 2008, said, "our problem was that the UPA government, I am not saying from point of criticism but introspection if you look back, suffered on domestic policy on two fronts..." "You (the UPA) did not realise time had come to end discretion and switch over to non-arbitrary mechanism for resources allocation. It was a fundamental mistake and we learnt from your mistake and corrected this," he said.
Jaitley said the UPA government's measures had scared away investors and adversely impacted several macro-economic parametres.
In this regard, the Minister referred to 2G spectrum and coal block allocations which were shrouded in allegations of corruption during the UPA government.
Because of the policies of the UPA, fiscal deficit, current account deficit and inflation had gone up significantly, he said, adding these were contained by the present government.
Jaitley said the fiscal deficit has been proposed at 3.2 per cent of the GDP for 2017-18 and will be further brought down to 3 per cent in the subsequent year.
Moreover, Jaitley said the quality of fiscal deficit too has improved during NDA regime as it is not on account of compressing expendititure but due to additional resource mobilisation.
"Our effort is to have as much public expenditure as possible while managing fiscal deficit," he said.
As regards to the inflation, Jaitley said it is at 3.6 per cent as against the target of 4 per cent (+/- 2 per cent) given to the RBI and the current account deficit has been brought down to 0.3 per cent from a high of 4.5 per cent during UPA regime.
Referring to demonetisation, he said it has not impacted the economy as apprehended by experts and added that even during the stress period (of November and December), the size of the formal economy was increasing.
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