In light of the unprecedented reversal of India's GDP growth this year, former Congress Party chief Rahul Gandhi has slammed Prime Minister Narendra Modi's demonetisation decision, which was taken two years ago to prevent Black Money.
Under Modi Government’s 2016 demonetisation decision, the country's high value currency notes were swapped to flush out black money.
Taking to social media on Thursday, Gandhi said demonetisation has devastated the country's economic growth and the informal economy.
It may be noted India has reported a 23.9 percent contraction in Gross Domestic Product (GDP) in April - June this year.
मोदी जी का ‘कैश-मुक्त’ भारत दरअसल ‘मज़दूर-किसान-छोटा व्यापारी’ मुक्त भारत है।— Rahul Gandhi (@RahulGandhi) September 3, 2020
जो पाँसा 8 नवंबर 2016 को फेंका गया था, उसका एक भयानक नतीजा 31 अगस्त 2020 को सामने आया।
GDP में गिरावट के अलावा नोटबंदी ने देश की असंगठित अर्थव्यवस्था को कैसे तोड़ा ये जानने के लिए मेरा वीडियो देखिए। pic.twitter.com/GzovcTXPDv
In his latest video series released on Twitter on Thursday, Gandhi said, “the informal sector in our country works on cash. Small shopkeepers and workers survive on cash. The target of demonetisation was to take money out from the informal sector. Prime Minister Narendra Modi told the nation that he wants a cashless India. If India goes cashless, small shopkeepers, farmers, and workers will be finished.”
"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," he said in the video.
However, in doing so, Gandhi did not elaborate on how the swapped currency was used to benefit the industrialists.
On 8 November, 2016, Modi announced his government’s decision to pursue demonitisation. He said it was targeted at removing older INR 500 and INR 1000 banknotes, in circulation at that time.
These were replaced by fresh currency notes in the denomination of INR 500 and INR 2000, which was released in the market by banks. The public was given 50 days to swap their old banknotes with new banknotes at bank counters.
At that time, former prime minister and key Congress leader Manmohan Singh had predicted that demonetisation would impact India's GDP by at least 2%.
"The frightening impact of the dice rolled on 8 November 2016 was revealed on 1 August 2020," Gandhi stated in his latest attack on Modi.
Gandhi remarked it while referring to the latest massive contraction in the Indian economy recorded for the April – June period, reported by the government on 31 August.
With GDP contracting, all major economic sectors such as construction, mining, electricity were in the red.
It may be noted that during the April- June period, for which the macroeconomic data indicated a severe contraction, many of the countries' woes pertained to the COVID-19 national lockdown, which was imposed with effect from 25 March and lasted till 31 May.
During the period, the Indian government also rolled out a $266 billion stimulus package to help the economy and the industries tide over the challenges posed by the COVID-19 pandemic.
India's banking regulator, The Reserve Bank of India, also pumped in the liquidity worth $128 billion to ensure stability in the financial market in February of this year.
It may also be noted that the Indian economy had been slowing down even before the pandemic hit. Indian growth had deflated consistently, from 8 percent in early 2018 to 3.1 percent in January – March this year.