Whoever implemented demonetisation, didn’t know elementary economics: Chidambaram

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chidambaram, File Photo

New Delhi, December 21: Former Union Finance Minister P. Chidambaram on Tuesday called demonetisation “a monumental tragedy” being implemented by those who “didn’t know elementary economics.”

Chidambaram was here to visit Mumbai University and gave a lecture on ’25 years of Economics Reforms and the Challenges Ahead’ in the country. He did not use #demonetization in his lecture but he criticised policy of noteban of Rs 500 and Rs 1000 vigorously in an interactive session with students, professors and other guests. The conversation was started as a student asked him about his views on Centre’s move of demonetisation of 86 % currency in terms of efficiency, output and social justice.

Chidambaram said demonetisation is a monumental tragedy being implemented by those who didn’t know elementary economics and should go back to undergraduate college.

He pointed out, all cash is not black money and black money is not cash, only 6 per cent of it is in the form of cash and it keeps flowing.

He said: Everything depends on demand and supply …as long as people demand for unaccounted money, it will be generated. The government should focus on stamping out corruption from various sectors that run on unaccounted money. Demonetisation is not the answer to black money.

While adding that government’s noteban move was the worst thing ever happened to a growing economy like India Chidambaram further said, “I don’t think DeMonetisation is a reform, I think it is a monumental tragedy. It is anti poor.”

He highlighted how it is important to fight poverty rather than implementing schemes that disrupt way of life in the country. “With the end of poverty, hunger will end, illiteracy will end and discrimination will end. Any country which is poor today, it is poor because of its own errors, own faults,” noted Chidambaram.

In a sharp lashing out of noteban, he said, “We are now in the distinguished company of Zimbabwe, North Korea, Libya and Venezuela, all smaller economies compared to India, thanks to the government’s move.”

He also said, “Imagine a doctor conducted a surgery but there was no information about the patient’s illness. The doctor did not know which part of the body of patient is affected but the surgery was conducted on some completely different part. It is tragic how farmers, self-employed people and small-scale businesses are the ones that are worst affected due to this move. The government should get sensible about it.”

Wefornews Bureau

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