Congress leader Rahul Gandhi continued his criticisms against the Centre on Thursday and said that India’s poor economic performance, which was reflected in the Gross Domestic Product figures, was a direct result of the government’s demonetisation policy of 2016. “The dice that was thrown on 8 November, 2016 had a terrible result on 31 August 2020,” he tweeted.
Data released by the Centre on Monday showed that the Indian economy contracted by 23.9% in the second quarter of April-June, registering the most devastating fall in decades, as the lockdown imposed to contain the coronavirus wiped out consumption and investment. The numbers reflect the onset of the deepest recession in India since 1996, when the country first began publishing its quarterly GDP figures.
In the second edition of his four-part video series titled “Arthvyavastha (economics) Ki Baat, Rahul Gandhi ke saath” the Congress leader said the slump in the GDP and the resulting plight of the poor was directly linked to demonetisation. “Modi’s ‘cash-free’ India is actually a ‘worker-farmer-small businessman’ free India,” he said.
The Congress leader alleged that the government’s “hidden motive” behind the note ban was to waive loans of corporates by taking out money from the informal sector. “On November 8, at 8 pm the prime minister [Narendra Modi] announced the move that left the entire country queueing up at banks” Gandhi said. “What was the benefit of the move? Was there black money? No. What did the poor get from the notes ban? Nothing. So who gained? Only the industrialists. Your money was used to waive loans to some industrialists.”
Gandhi added that the entire country must “unite and fight” against this attack on the poor, farmers and the informal sector. “The prime minister said he wants cashless India,” he said. “That means the unorganised sector is finished.”
In November 2016, the government had announced the demonetisation of Rs 500 and Rs 1,000 notes – nearly 86% of the currency then in circulation – in an effort to curb black money. However, the decision has since been blamed as one of the major reasons for a long period of economic slowdown and job losses in the following quarters.
In the previous edition of the series, Rahul Gandhi had alleged that the Bharatiya Janata Party-led central government implemented demonetisation, the Goods and Services Tax, and the coronavirus lockdown with an aim of destroying India’s informal sector. He claimed that there is a huge sum of money in the informal sector that the ruling government wanted to take away for itself.
Gandhi has been a constant critic of the Modi-led government at the Centre. On Wednesday, the Congress leader said apart from the ravaged state of the economy, India is confronted by multiple problems of unemployment, Chinese incursions along the border, and an alarming rise of coronavirus cases, because of the inefficiency of the Centre. He called these concerns “Modi-made disasters”.
Hours after the GDP figures were released on August 31, Gandhi had said that it was unfortunate the government chose to ignore his repeated warnings about the crumbling state of economy. “GDP reduces by 24%,” Gandhi wrote. “The worst in Independent India’s history. Unfortunately, the government ignored the warnings.”