Congress leader and former Union minister P Chidambaram on Tuesday said the Centre’s decision to demonetise Rs 500 and Rs 1,000 currency notes had caused great distress to the public, ANI reported. Criticising the Centre for its decision, Chidambaram compared the move to a natural calamity and said its biggest impact would be felt in rural India.
The former minister said it was “an illusion” that the move would benefit the poor and hurt the rich. Claiming the move had dented investor confidence in the Indian economy, Chidambaram said it would have a negative impact on the country’s Gross Domestic Product in the long term.
He also attacked the Narendra Modi-led government for not holding consultations with any individuals or groups before executing the decision. “You can’t trivialise a major blow to India’s economy,” he said, adding that the Centre did not even consult former finance minister Yashwant Sinha and former primer minister Manmohan Singh, who criticised the move in the Rajya Sabha. “Credit growth, greenfield investment and aggregate demand are [at an] all-time low due to demonetisation. These numbers matter,” he said.
Chidambaram refuted the Centre’s claim that demonetisation would help transition the country to a cashless economy. “To assume India will go from 3% to 100% cashless in a matter of [a] few months is outlandish.”
Separately, Congress vice-president Rahul Gandhi accused the prime minister of changing narratives to justify the government’s demonetisation move, The Indian Express reported. “First it was a fight against black money, then terrorism and not its’s about making society cashless,” Gandhi said outside a bank ATM in Uttar Pradesh’s Dadri. “Modiji, you have made the economy ‘cashless’ as people don’t have cash now. The whole world is crying,” the Congress leader said.
Opposition parties including the Congress have heavily criticised the discontinuation of the high-value notes. In an opinion piece for The Hindu, Manmohan Singh said Modi had “shattered the faith and confidence that hundreds of millions of Indians had reposed in the government to protect them and their money.” During his address in the Rajya Sabha on November 24, Singh had described the move to demonetise Rs 500 and Rs 1,000 notes as a form of “organised loot” and said it would reduce the country’s GDP by 2% or more.
Since the announcement of the move on November 8, the Modi government has been trying to promote the idea of cashless economy by encouraging everyone to take up digital payment options. Infosys co-founder and former Unique Identification Authority of India chairman Nandan Nilekani has been brought in by the Centre to map out India’s digital payments drive.