Speaking at a briefing at Congress party headquarters on April 26 2014, Finance Minister P Chidambaram painted a rosy picture of the economy that he was handing over to the next finance minister.
The current account deficit, which had risen to a dangerous level of $88 billion, or 4.8 per cent of gross domestic product in 2012-13, had been controlled and was expected to decline to $32 billion, or 1.7 per cent of GDP, he argued.
And the full financial year's fiscal deficit, he added, would be within the "red line" that he had drawn for himself some time ago. He insisted that the target of 4.6 per cent of GDP for the fiscal deficit that he had set would be met.
Mr Chidambaram may be right on the broad numbers. It is certainly true that the current account deficit has shown a sharp decline and spending has been almost brutally curtailed, preventing the fiscal deficit from rising.
And he is also right to argue that the turnaround in the headline numbers is a major reason for continuing flow of funds into the Indian economy.
But the larger story is somewhat different.
Text: Business Standard
Image Courtesy: PTI