Economy contracted but government managed to contain inflation at 6pc: Nirmala Sitharaman

Finance Minister Nirmala Sitharaman on Friday said the Indian economy suffered the biggest contraction due to Covid-19 pandemic, but the government has been able to contain retail inflation at 6.2 per cent.

Replying to a general discussion on the Union Budget in Rajya Sabha, the minister said, the Budget for 2022-23 fiscal year, stands for continuity, brings stability to the economy along with predictability of taxation. The objective of the budget is a stable and sustainable recovery in the economy, she said.

Compared to the performance of the UPA government during the global financial crisis in 2008-09, she pointed out that retail inflation was 9.1 per cent during the financial crisis of 2008-09, while it is at 6.2 per cent during the Covid-19 pandemic that has a bigger impact on the economy. The minister said the Indian economy suffered the biggest contrac She also said tion due to the pandemic. It suffered Rs 9.57 lakh cr loss due to the pandemic, compared to a loss of Rs 2.12 lakh cr during the global meltdown in 2008-09. Capital spending gives much more multiplier than revenue route and so the government has raised public capital spending to boost the economy.