New Delhi: Niti Aayog vice-chairman Rajiv Kumar has held the UPA-II responsible for the economic slowdown and crisis of liquidity being faced by India today. Terming the crisis as "Unprecedented" Kumar said, "This is an unprecedented situation for the government. In the last 70 years, we have not faced this sort of liquidity situation where the entire financial sector is in a churn, and nobody is trusting anybody else,".
Though later when his statement was picked up widely by social media and it went viral, he said media is trying to manipulate his statement. Rajiv Kumar took the Twitter route to reach out to people and requested media not to "misinterpret" what he said. "I would request the media to stop misinterpreting my statement. The government has been taking bold steps to accelerate our economy & will continue to do so. There is no need to panic or spread panic" wrote Kumar.
Earlier in his speech, Rajiv Kumar citing the situation of liquidity crisis in the financial sector and weak private investments, said "Within the private sector, nobody wants to lend to anybody else. Everyone is sitting on cash,". He also said the government needs to take "out of the ordinary" steps to revive growth.
"The whole nature of the game has changed in the past four years after demonetisation, GST and IBC. In the earlier period, you had 10, 20, 30, 35 per cent of cash sloshing around which used to help people. That has become much less now,"
"The whole nature of the game has changed in the past four years after demonetisation, GST and IBC. In the earlier period, you had 10, 20, 30, 35 per cent of cash sloshing around which used to help people. That has become much less now," Kumar added.
"This is an unprecedented situation for the government. In the last 70 years, we have not faced this sort of liquidity situation where the entire financial sector is in a churn, and nobody is trusting anybody else,"
He also blamed UPA-II for giving easy loans that later piled up in the shape of Non-Performing Assets (NPAs) for the government banks. The rising NPAs ultimately resulted in the shrinking of lending capital.