Former Prime Minister Manmohan Singh, who has also served as governor of the Reserve Bank of India and finance minister, spoke in the Rajya Sabha on Thursday, criticising the implementation of the government’s demonetisation scheme. Singh, in a rare parliamentary interjection since stepping down as prime minister, said that the effect of the move to withdraw older Rs 500 and Rs 1,000 notes could see India’s Gross Domestic Product decline by 2%.
“This is an underestimate, not an overestimate,” Singh said. He pointed out how much the country is suffering because of the move, noted how a 50-day deadline to replace the currency was the equivalent of a lifetime of pain for some, and then took his criticism a step further. “In all, these measures convince me that the way this scheme has been implemented is a monumental management failure, and in fact, it is a case of organised loot, legalised plunder of the common people.”
Take a step back and note just what’s happened here. A former prime minister whose tenure, particularly in his second term, was marred by a number of serious corruption scandals that reached all the way to his office, told the Rajya Sabha that the new government has brought in a scheme that amounts to “organised loot.”
Two and a half years after Singh’s Congress was dealt a historic electoral rout, in part because of widespread anti-corruption sentiments, he accused his successors of “legalised plunder.”
And people listened.
Indeed, this is the more surprising part. Nothing Singh said was particularly novel or insightful. In his short speech, he pointed out that the vast majority of Indians still transact with the informal sector, that farmers have been hit hard by the demonetisation effort and the failure to bring co-operative banks on board has added to the distress. Even his 2% GDP decline number will remain nebulous until he adds more details about how he came to that conclusion.
Yet Singh’s speech was highly anticipated and even members of the ruling National Democratic Alliance, like the Shiv Sena, said that the government needs to be listening.
You might expect people to listen to the Congress, even after it was brought down to 44 Members of Parliament in 2014, on cultural matters such as secularism or public welfare, because the party often has genuine ideological differences with the ruling Bharatiya Janata Party.
Economics, however, was supposed to be Narendra Modi’s strong suit, with “development” being one of the key buzzwords of his prime ministerial campaign. Instead, renowned economists are starting to speak of the massive gamble demonetisation is, while indications from across the economy suggest distress even as people stand behind the aims of cracking down on black money.
The distress has almost been massive enough that it seems to have somewhat rehabilitated at least Manmohan Singh, who was until recently invoked as being a man of integrity who nevertheless turned a blind eye to massive amounts of corruption in his tenure.
In January 2014, Singh said “history will be kinder to me” than the media was at the time. Did anyone expect that to happen so soon?