Congress Leader P Chidambaram Launches Scathing Attack on Budget 2026-27 in Rajya Sabha
Initiating a crucial discussion on the Union Budget for the fiscal year 2026-27 in the Rajya Sabha on Monday, senior Congress leader and former Finance Minister P Chidambaram launched a sharp critique against the government. He specifically targeted the administration for its decision to cut capital expenditure in the previous fiscal year of 2025-26, labeling the current budget as "forgettable".
A "Forgettable" Budget and Broken Promises
Chidambaram did not mince words, stating that this budget has been prepared by a finance minister who has seemingly forgotten the commitments made in the House just a year ago. "This is a forgettable budget... which has been prepared by a finance minister who forgot the promises made by her in this House last year," he asserted, highlighting a perceived disconnect between past assurances and present fiscal policies.
Declining Growth and Stagnant Investment Figures
The former finance minister presented a detailed analysis of economic indicators to bolster his argument. He pointed out a concerning trend in nominal growth rates, noting that while the rate stood at 12% in 2023-2024, it has reduced significantly to 9.8% in the past fiscal year. This slowdown, according to Chidambaram, underscores broader economic challenges.
Further elaborating on investment woes, he emphasized that capital investment, measured as gross fixed capital formation, has remained stagnant at approximately 30% of GDP for nearly twelve years. "For almost 12 years, capital investment, gross fixed capital formation, has been stuck at 30% of GDP," he remarked, suggesting a lack of progress in boosting long-term economic infrastructure.
Collapse in Foreign and Private Investment
Chidambaram also highlighted alarming declines in foreign direct investment (FDI) and private sector participation. He revealed that net FDI in 2024-25 collapsed to less than 0.09%, a stark figure that raises questions about investor confidence. Additionally, he noted that foreign portfolio investors (FPIs) are pulling out of the market, further exacerbating capital flight concerns.
Despite companies being cash-rich, private investment remains stuck at 22% of GDP, indicating a reluctance to deploy funds into new projects. "Private investment, although the companies are cash rich, is stuck at 22% of the GDP," he stated, pointing to a paradox where available capital is not translating into productive investments.
Questioning the Momentum of Reforms
In a pointed rhetorical question, Chidambaram challenged the government's narrative on economic reforms. "Where is the reform express gathering momentum," he questioned, implying that the promised acceleration in policy changes and economic revitalization is not materializing as expected. This query encapsulates his broader critique that the budget fails to address fundamental investment and growth issues, potentially hindering India's economic trajectory.
The discussion in the Rajya Sabha sets the stage for further parliamentary debates on the budget, with opposition voices like Chidambaram's underscoring key fiscal and economic concerns that could shape public and political discourse in the coming months.
