No cause for alarm on economic front: Chidambaram

On concerns over the current economic situation, Home Minister P Chidambaram said that there is no cause for alarm or panic.

Updated: Jun 05, 2012, 16:27 PM IST

Bhopal: Stepping out of the capital, the Group of Ministers (GoM) on media on Tuesday held an interaction with journalists here to assuage concerns over the current economic situation, saying there is no cause for alarm or panic.

"Just as we recovered after 2008-09, we are confident we can recover in 2012-13 and 2013-14. Kindly remember that we are subject to what is happening in the international arena," Home Minister P Chidambaram said here.

Chidambaram said in the first of the media interaction programmes of the GoM in state capitals that he was here to mark the completion of three years of UPA-II as "there is much to be satisfied about but there are also challenges."
Along with two other member of the group--Law Minister Salman Khurshid and Minister of State in the PMO V Narayanasamy, he said, "2011-12 has been a year of declining growth because of the Eurozone crisis. While we recognise the challenges the economy faces, I want to say on behalf of the government that there is no cause for alarm or panic."

The ministers were here to meet Bhopal gas victims and activists in the wake of the Supreme Court asking the government last month to take a decision on the disposal of toxic waste left in the aftermath of the disaster in 1984 which had claimed thousands of lives.

"The Centre had spoken to the governments of Madhya Pradesh, Gujarat and Maharashtra but all of them refused to allow disposal of the toxic waste," the Home Minister, who visited the Bhopal Memorial Hospital, set up for gas tragedy victims, said.
"Before saying anything about the manner in which the present situation was being handled, one must remember that there were different contexts in which the UPA-I and UPA-II were functioning," the former Finance Minister said making a reference to the economic scenario.

At the time of UPA-I, the international financial situation was "very good" and because of that the government was able to achieve a growth rate of nine per cent, he said.

"Things had changed drastically under the UPA-II and right now, barring Germany, no other European nation has been able to show any growth," he said.

Chidambaram said similarly, the price of an oil barrel in international market is much more now than what it used to be.

"There are countries which are registering zero per cent growth. There are countries which are facing two quarters of successive recession, yet we continue to grow. In the last three years, the government can report significant achievements...," he said referring to its `Report to the People`.

"You will recall that for the first time, India witnessed nine per cent growth between 2004 and 2008. In fact, the average for those four years was 8.85 per cent GDP growth.

"Then we had the international financial crisis. Yet in 2008-09, the decline in the economic growth was only to 6.7 per cent. After UPA-II was formed, we had the first year of moderate growth, but we quickly picked up," he said, adding that in two years, the growth was 8.4 per cent.

He said he was confident of the government meeting the present day challenges as India had overcome many challenges since 1991.

"There had been challenges at various times, but India had managed to overcome all of them. I do not see any possibility of the situation turning out any different this time," he said.

Chidambaram said that the Central government apparently has been unable to present before the people the poor international economic condition.

"I think people would have responded well if they had been told about the poor economic situation which was leading to problems in our country," he said.

The Home Minister said there have been "significant" achievements in the power, telecommunication and education sectors and key legislations have been passed.

"For example, five lakh new classrooms have been constructed, 51,000 new schools have been built, 6.8 lakh new teachers have been appointed. It might just look mere numbers, but the enormous benefit of this will be felt in 5-10 years," he said.

PTI