In an exit interview given to Sunil Jain and P Vaidyanathan Iyer, finance minister P Chidambaram points out that, when it comes to critical reforms like getting GST passed or opening up the coal sector, the next government will be in an equally big fix — parliamentary paralysis, he says, was an important constituent of the so-called policy paralysis. Apart from saying the CBI didn’t seem to have all the facts when it registered a preliminary enquiry into former Sebi chief CB Bhave, Chidambaram said banks were not facing a crisis, that work had begun on the projects cleared by the CCI, that he disagreed with the Urjit Patel committee’s recommendation on inflation-targetting and that Aadhar will need to be thought through completely. Edited excerpts:
Should RBI be buying dollars? Is the rupee’s recent appreciation the reason why exports are slowing?
That would be a premature conclusion. The REER for six countries is about 96 or so.
Wasn’t the idea, after the Vodafone settlement was reached, that the law would be made prospective? Today, we have news that Cairn has put off an issue because of a tax notice. Do you think the taxman has gone on a rampage?
Every tax demand is not wrong or an extravagant act. Have you heard what the G-20 ministers said? Every country is worried about “base erosion and profit splitting”. The media immediately jumps to the conclusion that the tax notice must be wrong because MNCs say so.
But 60-70% of the tax demands are stuck down in courts.
That's not something which happened today. That's nothing to do with any policy change that was allegedly made in the last few years.
Since the amendment, other cases have been opened up. Isn’t that a problem?
You can re-open for six years without the amendment. There is no need to rely on the Vodafone amendment to re-open a case for 5-6 years.
What are the reforms you regret not doing? Labour?
I think we should have pulled back on the monetary expansion at least a year earlier. I can't speak on labour reforms. All those who talk about labour reforms when they are not in the government, don't try to implement labour reforms when they are. All I can say is that all the measures we took on the fiscal side and on the monetary side, since August 2012, I wish we had done it earlier. We would have given