Modi's brand is crony capitalism, says Chidambaram

Finance Minister P Chidambaram on Monday hit out at BJP Prime Ministerial candidate Narendra Modi's brand of capitalism as "crony capitalism" and dismissed questions raised by senior BJP leader Yashwant Sinha against him on the economy as "puerile".

"Business is quite comfortable with Dr Manmohan Singh and UPA finance ministers but there are sections of businesses which are extremely comfortable with Mr Narendra Modi because his brand of capitalism is crony capitalism," he said at a press conference at the AICC headquarters in New Delhi.

Chidambaram said the economy is in much better shape, with foreign exchange reserves rising and the fiscal and current account deficits firmly under control.

"The economy today is far more stable and far stronger than what it was 20 months ago and what we fear may happen has not happened. And going forward, I can only see spirited growth in the economy, provided the next government adheres to the 10-point agenda that I have outlined in my interim budget," he said.

Chidambaram, who has opted out of the elections, asserted that the next finance minister would not be of Modi's choosing, adding, "I will keep a firm hand on the wheel till the last day and I will hand over the wheel to a firm hand."

The minister said the government has been able to contain the fiscal deficit and the current account deficit (CAD).

"Our reserves today have crossed $300 billion. We expect to add $25 billion by end of today to our reserves. And CAD, which is originally estimated at under $60 billion, is now likely to be much smaller. Perhaps about $35 billion...Nobody talks about a downgrade anymore, the fundamentals have strengthened," he added.

On the 18 questions raised by Sinha, Chidambaram said, "Many of them are quite puerile questions...Mr Sinha today is a distant memory for the people of India and I hope he remains where he is-a distant memory."

Accusing Chidambaram of playing "spoiler" and "ruining" the economy, Sinha had sought replies on issues such as declining growth, rising inflation and a poor track record on job creation.

Chidambaram also indicated that government may further ease restrictions on gold imports after Tuesday's monetary policy by RBI as current account deficit has moderated to about $35 billion.

"Some relaxations were made a few days ago when more banks were allowed to import gold. We could consider some more relaxations in consultation with RBI," he said while releasing the year-end report on economy.

"Let the RBI's monetary policy be announced tomorrow and then we will consider whether some relaxation can be done," he said.