‘What hap­pened to Prophets of Doom?’


Mail Today - - NEWS - By Ashutosh Mishra In New Delhi

Needed to shake sys­tem. DeMo led to for­mal­i­sa­tion of econ­omy, ex­panded tax base. What hap­pened to the Prophets of Doom who pre­dicted a 2 per cent hit to the GDP?


To­day marks the 2nd an­niver­sary of the ill-fated and ill-thought de­mon­eti­sa­tion ex­er­cise … The havoc that it un­leashed on In­dian econ­omy and so­ci­ety is now ev­i­dent to ev­ery­one..


For­mer Union fi­nance min­is­ter P Chi­dambaram de­scribed de­mon­eti­sa­tion as ‘cat­a­strophic’

ON this day two years ago, Prime Min­is­ter Naren­dra Modi made a sur­prise the na­tion with an evening an­nounce­ment he de­clared high value Rs 1,000 and Rs 500 cur­rency notes in­valid.

De­mon­eti­sa­tion sur­prised the na­tion but sent the econ­omy spi­ralling into shock from which many are still try­ing to re­cover.

This is the Op­po­si­tion’s line against the claim of suc­cess be­ing made by the Cen­tre on the sec­ond an­niver­sary of de­mon­eti­sa­tion.

The Left par­ties are tar­get­ing the gov­ern­ment and call­ing de­mon­eti­sa­tion a scam. The Con­gress plans to hold a na­tion­wide protest Novem­ber 9 to high­light this. But Union fi­nance min­is­ter Arun Jait­ley nar­rated the suc­cess of de­mon­eti­sa­tion in a blog writ­ten on the oc­ca­sion.

“De­mon­eti­sa­tion is a key step in a chain of im­por­tant de­ci­sions taken by the Gov­ern­ment to for­malise the econ­omy. Gov­ern­ment first tar­geted the black money out­side In­dia. As­set hold­ers were asked to bring this money back on pay­ment of pe­nal tax. De­mon­eti­sa­tion com­pelled hold­ers of cash to de­posit the same in the banks,” Jait­ley wrote in his blog.

Jait­ley also claimed that the enor­mity of cash de­posited and iden­ti­fied with the owner re­sulted in re­sponse be­ing re­ceived on­line through non-in­va­sive meth­ods from an es­ti­mated 17.42 lakh ac­count hold­ers.

He claimed that UPI dig­i­tal trans­ac­tions have grown from Rs 0.5 bil­lion in Oc­to­ber 2016 to Rs 598 bil­lion in Septem­ber 2018. Jait­ley’s nar­ra­tive was coun­tered by for­mer Union fi­nance min­is­ter P Chi­dambaram who de­scribed de­mon­eti­sa­tion as “cat­a­strophic”. “The con­se­quence of DeMo has been cat­a­strophic. Over a 100 peo­ple have died. The GDP fell by 1.5 per cent. The gov­ern­ment no longer talks of ‘Ac­che Din’ but all we hear about is the Hin­dutva agenda,” he said.

CPM gen­eral sec­re­tary Si­taram Yechury also di­rected fire at the Modi gov­ern­ment on the sec­ond an­niver­sary of de­mon­eti­sa­tion. Yechury told In­dia To­day TV, “Dig­i­tal trans­ac­tion could have in­creased the am­bit of tax­pay­ers, but col­lec­tion of the tax to gov­ern­ment trea­sury has de­clined. And if this is not true, why is the gov­ern­ment hid­ing the data?"

In­dia To­day TV hit the streets to as­sess the sit­u­a­tion two years af­ter DeMo hit In­dia. Dig­i­tal trans­ac­tions are still a novel phe­nom­e­non for driv­ers of cy­cle-rick­shaws, e-rick­shaw, and au­torick­shaws the com­mon man’s mode of trans­port. Bhan Singh, an au­torick­shaw driver, be­lieves that even af­ter two years, the `2,000 cur­rency note still af­fects his daily busi­ness. Durga Prasad sells veg­eta­bles near a res­i­den­tial colony in cen­tral Delhi and says that he has not yet man­aged to emerge out of the loss ac­crued due to de­moni­ti­sa­tion. “Peo­ple are spend­ing less and the busi­ness is com­par­a­tively slower than what it was be­fore Novem­ber 8, 2016.”

In­dia To­day TV

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