BJP, Congress duel as demonetisation turns two

New Delhi: The second anniversary of demonetisation on Thursday saw a bitter exchange of verbal blows between the ruling BJP and the Opposition parties, with the former hailing the move for pushing formalisation of the economy and the Congress calling the exercise a carefully planned “criminal- financial scam” that unleashed havoc.

Finance minister Arun Jaitley strongly defended the exercise saying demonetisation resulted in increased tax base, with the government earmarking more resources for the poor and infrastructure development.

Taking a dig at the Opposition in a Facebook post, Mr Jaitley said that “prophets of doom” have been proven wrong as hard data of two years shows greater formalisation of the economy and India retaining the fastest growing economy tag for the fifth year in a row.

However, former Prime Minister Manmohan Singh and Congress president Rahul Gandhi alleged that demonetisation was a planned “brutal conspiracy” and a “shrewd scheme” to convert the black money of Prime Minister Narendra Modi’s “suit-booted friends” to white.

Dr Manmohan Singh, in a statement, said, “Today marks the 2nd anniversary of the ill-fated and ill-thought demonetisation exercise … The havoc that it unleashed on Indian economy and society is now evident to everyone.”

In a scathing assessment of the demonetisation exercise, Dr Singh said the “scars and wounds” it caused are getting more visible with time and the decision’s second anniversary is a day to remember how “economic misadventures” can roil the nation.

“It is often said that time is a great healer. But unfortunately, in the case of demonetisation, the scars and wounds of demonetisation are only getting more visible with time,” the former Prime Minister said.

Alleging that the exercise was a carefully planned “criminal-financial scam”, Congress president Rahul Gandhi tweeted, “Note ban was a premeditated brutal conspiracy. This scam was a shrewd scheme to convert the black money of Prime Minister’s suit-booted friends to white. Nothing was innocent in this scam. Drawing any other meaning of it would be an insult of the intelligence of the nation.”

Mr Gandhi called the exercise a “monumental blunder” and said that “the government’s spin-doctors, including our incompetent finance minister, have the unenviable task of defending an indefensible, criminal policy”

“Demonetisation was a tragedy. India has faced many tragedies in its past. Many a time have envious, external enemies tried to hurt us. But demonetisation is unique in the history of our tragedies because it was a self-inflicted, suicidal attack that destroyed millions of lives and ruined thousands of India’s small businesses,” he alleged.

Mr Gandhi claimed that the worst hit by demonetisation were the poorest of the poor who  were forced to queue up for days to exchange their meagre savings.

West Bengal chief minister Mamata Banerjee alleged that the note ban was initiated for the benefit of a handful of people, saying the common people were the worst sufferers.

Former finance minister P. Chidambaram described the note ban scheme as the most ingeniously designed official money laundering scheme.

Questioning the rationale behind the exercise, Delhi chief minister Arvind Kejriwal termed it as “a self-inflicted deep wound” on the Indian economy.

Firing 10 questions at the Congress, the BJP asked why the Opposition party finds merit in protesting every “anti-corruption” measure of the Narendra Modi government and accused it of “living in denial” despite a surge in GDP numbers.

“Is the Congress living in a state of denial that it cannot see the surge in GDP numbers, the ‘ease of doing business rankings’ and Global Competitiveness Index? Why are they unhappy that India’s economic prowess is being recognised the world over?” asked a BJP leader.

The saffron party also took a dig at Mr Chidambaram over his criticism of the government’s economic policy, saying he is himself under radar of investigating agencies for “massive corruption” involving land, cash and foreign bank accounts.

Highlighting the benefits of demonetisations, Mr Jaitley listed an 80 per cent jump in income tax return filers to 6.86 crore, increase in digital transactions and more resources being available for poor and for building better infrastructure as the main achievements.

With depositing junked currency in banks only mode left to liquidate holding of old 500 and 1,000 rupee notes, the government was able to track down people holding cash beyond their known sources of income, he claimed.

“The enormity of cash deposited and identified with the owner resulted in suspected 17.42 lakh account holders from whom the response has been received online through non-invasive method,” he wrote.

Responding to criticism from the Opposition parties, Mr Jaitley said India clocking the fastest growth rate has proved “prophets of doom”, who had predicted that demonetisation will shave off 2 per cent of growth rate, conclusively wrong.

The government had on November 8, 2016, announced ban on old 500 and 1000 rupee notes, to curb black money in the system.

Of the Rs 15.41 lakh crore worth Rs 500 and Rs 1,000 notes in circulation on November 8, 2016, 99.3 per cent or notes worth Rs 15.31 lakh crore have returned to the banking system. This means, just Rs 10,720 crore of the junked currency did not return to the banking system.