Finance Minister Nirmala Sitharaman has accused former Prime Minister Manmohan Singh of leaving behind “a nasty stink of corruption” in the public banking sector, which suffered its “worst phase” under him and former Reserve Bank Governor Raghuram Rajan.
During Rajan’s tenure “loans were given just on the basis of phone calls from crony leaders and public sector banks in India till today are depending on government equity infusion to get out of that mire,” she said on Tuesday during a lecture at Columbia University.
Sitharaman further said: “Indian public sector banks did not have a worst phase than when (there was) this combination of Dr Manmohan Singh and Dr Raghuram Rajan, as Prime Minister and Governor of the Reserve Bank.”
She was responding to an audience member’s question about Rajan’s reported criticism that PM Modi’s government is “extremely centralised” and does not have a “consistent and articulated vision” for economic growth.
Lashing out at Rajan, Sitharaman said, “Rather too democratic a leadership, which probably will have the approval of quite a lot of liberals, I am afraid he left behind such a nasty stink of corruption which we are cleaning up even today.”