Demonetisation could lead to famine

The demonetisation of Rs. 500 and Rs. 1000 notes that was announced by Prime Minister Narendra Modi on November 8, 2016 could lead to famine in West Bengal as well as many other states, claimed West Bengal chief minister Mamata Banerjee.

Speaking to reporters after her quarterly review of the state’s performance with ministers and departmental secretaries Mamata said that this ill-thought-out decision could lead to famine and severe problems for the informal sector that employs over 60 per cent of the working population.

“The decision to demonetise the currency has led to severe hardship among the poor and the marginalised. In many areas, labour is not available to harvest the grains from the field. In other parts of the state, farmers are not able to earn money from cultivation of vegetables as demand has slowed down and people are cutting consumption,” the chief minister said.

Mamata also harped on the effects of the currency ban on small traders, especially those who serve the marginal sections of society. “Tea sellers who used to earn Rs500 a day are now unable to find customers due to shortage of currency. This Rs2,000-note has created more confusion and hardships for the people. This happens when the leadership loses connection with people,” said Mamata.

The BJP though has blamed Mamata Banerjee for trying to mislead people on the whole issue. “The coffers of the Trinamool Congress (TMC) have been affected by demonetisation and that is why she is so angry. Also, the scams have proved how corrupt the party is,” said Dilip Ghosh, president of the West Bengal unit of the BJP.

TMC hit back that the upcoming polls would teach the party a lesson. “Polls are a great leveller. The BJP is still unsure of its strategy and the continuous change of rule has hurt the faith of the country in the currency and the Reserve Bank of India,” said senior TMC leader Saugata Roy.

The economist said that the sudden announcement has hurt the low income group more than the so-called money hoarders. “The decision will lead to a recession-like situation in the country and poor people will be the most affected,” said Ranjan Dasgupta, an economist.

“Currency is nothing else but a promise to pay. If people lose faith in it and its custodian, the central bank, then it is doomsday for the country. The continuous change in rules has eroded the faith of the people and also the fact that 97 per cent of the currency in circulation has come back means that the process has completely failed,” Dasgupta added.

source: GULF NEWS