Mumbai: Former Finance Minister P. Chidambaram on Tuesday termed the demonetization of Rs 500 and Rs 1,000 notes “a monumental tragedy” which has brought misery to millions in the country.
“It is an anti-poor measure and has plunged millions of farmers, small businessmen and workers into misery and hardships. It has created a myth that all cash is black money, when it it not,” Chidambaram said without mincing words.
“We are now in the league of economies of Libya, Zimbabwe, Venezuela and North Korea,” Chidambaram added, referring to the demonetization of the currencies of these countries in the past.
The Congress leader reiterated that black money cannot be extinguished since it is not a stock but a flow of cash and as long there was a demand for black money, there will be supply.
“People are getting caught with bribes in new currency notes now – so how is there a difference made with demonetization? Those who support demonetization do not know elementary economics.”
He was interacting after delivering the first D.T. Lakdawala Memorial Lecture on 25 years of economic reforms in India, organised by the Mumbai University’s Department of Economics in the presence of Vice Chancellor Sanjay Deshmukh.
Chidambaram said there have been 11 seminal reforms since 1991 and urged the students to get the 12th reform.
He listed some of the 11 important reforms that changed the face of the Indian economy as abolition of industrial licences, moving away from fixed exchange rates, reduction in tax rates, adoption of PPP models, abolition of state monopoly in telecommunications and bringing private companies into the telecom revolution.