On the expenditure front, Chidambaram had enforced a tight leash with revenue expenditure growing by only 12.69 per cent year-on-year. But capital expenditure, which is required to create productive assets, actually registered a negative CAGR of 3.2 per cent during his tenure.
The last three years also saw a rush of capital into the country as portfolio investors pumped in record money into the stock market and private equity players too contributed to this growth.
This created a piquant problem for the government and also for the Reserve Bank of India.
Image: Reserve Bank of India Governor Duvvuri Subbarao. | Photograph: Indranil Mukherjee/AFP/Getty Images
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