Why Manmohan Singh is warning India against demonetisation
On November 24 this year, a quiet, blue-turbaned man who had been at the helm of economic affairs of India for over two decades, and engineered one of the biggest changes in the financial structure of the country, opening it up and expanding it exponentially, in keeping with the changing world order, spoke in Rajya Sabha.
Dr Manmohan Singh’s 6.47-minute-long speech, which came after his long silence on many things in the past two and half years of Narendra Modi government, described demonetisation as “monumental mismanagement, legalised plunder and organised loot”.
Singh’s censure – firm and stony – reflected the pain over 90 per cent of Indians are being made to undergo, because PM Modi, in one fell swoop, turned 85 per cent of currency as cash into worthless pieces of paper.
Even then, in Rajya Sabha, Dr Singh’s resolute opposition to this thoughtless and extremely insensitive diktat, reverberated with a sad urgency.
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| In Rajya Sabha, Singh’s resolute opposition to this thoughtless and extremely insensitive diktat, reverberated with a sad urgency. |
Two weeks since then, Dr Singh has penned an op-ed in The Hindu, published this morning, repeating and reiterating the points he had made that day.
It’s a simple, lucid and yet brilliant exposition of what is wrong with the sudden decision to demonetise Rs 500 and Rs 1,000 notes, and how that has “shattered the faith and confidence that hundreds of millions of Indians had reposed in the Government of India to protect them and their money”.
Here are some of the top points and excerpts from the article:
On black money
Evidence from these past attempts has shown that a large majority of this unaccounted wealth is not stored in the form of cash. All black money is not in cash, only a tiny fraction is.
Against this backdrop, the decision by the prime minister is bound to have obverse implications by causing grievous injury to the honest Indian who earns his/her wages in cash and a mere rap on the knuckles to the dishonest black money hoarder.
On wage economy
More than 90 per cent of India’s workforce still earn their wages in cash. These consist of hundreds of millions of agriculture workers, construction workers and so on.
On lack of banking facilities
While the number of bank branches in rural areas have nearly doubled since 2001, there are still more than 600 million Indians who live in a town or village with no bank. Cash is the bedrock of the lives of these people.
On government duty
It is the fundamental duty of a democratically elected government in any sovereign nation to protect the rights and livelihood of its citizens. The recent decision by the prime minister is a travesty of this fundamental duty.
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