Replying to the debate on the Supplementary Demands for Grants in the Rajya Sabha, Sitharaman said that inflation in India purely “extraneous” nowadays because of fuel and fertiliser prices.
India’s retail inflation based on consumer price index remained above the Reserve Bank’s tolerance level of 6% since January this year. It declined to 5.88% in November, making it the first time in 2022 to fall within RBI’s band.
On the other hand, wholesale price based inflation (WPI) fell to 21-month low last month.
Soaring prices of commodities has been a major challenge for the government and RBI alike ever since Russia’s invasion of Ukraine in February disrupted major trade routes and hiked prices of key items like crude oil.
Later, the Rajya Sabha returned the Supplementary Demands for Grants to the Lok Sabha, thus completing the process of authorising the government to spend an additional Rs 3.25 lakh crore in FY2022-23.
Sitharaman also stressed that the supplementary demand for grants is essentially for food security, fertiliser requirements and providing support to the Indian economy.
The finance minister also informed the House that Gross NPAs of banks has declined to 6-year low of 5.9% in March 2022.
She also said the government’s targeted approach to deal with Covid impact has helped India in reviving growth without going into recession.
Speaking on the debate over freebies, the finance minister said: “It is important to recognise that when you are transparent in your methods, there is no debate over it (freebies). All we want is transparency and compliance with statutory fiscal rules.”
Noting that education, health and other subsidies given to farmers are fully justified, Sitharaman said that subsidies/ freebies are to be contextualised.
“Subsidies/freebies are to be contextualised. If you’re able to put it in your budget and make a provision for it, when your revenues come and you give the money, why would anyone have an objection? Education, health, many subsidies given to farmers, are fully justified,” she added.
(With inputs from agencies)