1. Demonetisation impact to last longer than expected: Jean Dreze

Demonetisation impact to last longer than expected: Jean Dreze

Demonetisation will take an "awful toll" on the underprivileged, especially wage labourers, and its impact might be worse and last longer than expected, noted development economist Jean Dreze has said.

By: | New Delhi | Published: January 8, 2017 5:27 PM
money-l As far as the impact of demonetisation of higher value currency notes is concerned, he said, “The crisis will take an awful toll on the underprivileged, especially wage labourers.”

Demonetisation will take an “awful toll” on the underprivileged, especially wage labourers, and its impact might be worse and last longer than expected, noted development economist Jean Dreze has said. Dismissing the claim that the demonetisation was a “surgical strike” on black money, he said if the government is really interested in dealing with the problem of ill-gotten wealth, it would be useful to start the process by introducing transparency in political funding.

“The BJP, being in power and a proud enemy of corruption, would do well to set an example by disclosing its own accounts,” Dreze, a former member of UPA’s National Advisory Council (NAC) and now a visiting professor at the department of economics at Ranchi University, told PTI in an interview.

As far as the impact of demonetisation of higher value currency notes is concerned, he said, “The crisis will take an awful toll on the underprivileged, especially wage labourers.”

“The effects of demonetisation might be worse and last longer than the government seems to expect. Short-term changes in the informal sector are largely below the radar of official statistics,” Dreze added.

Noting that the economic growth in the private sector has more or less ground to a halt for now, the Belgian-born Indian economist said,”recovering from this broad-based slump is likely to take time.”

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Observing that the cashless payments may have some merits, but forcing them on the population at the risk of crashing the economy is not a fair way to promote them, Dreze hinted the real purpose of demonetisation is different – perhaps something to do with corporate interests or electoral politics.

“In terms of the hidden purpose, demonetisation may be a success, but at the expense of the general public,” he noted.

Stressing that the government has enough legislative powers to go after the big fish, including the top corporate loan defaulters, the noted economist said he is sure that would be more effective than to harass millions of Jan Dhan account holders in an elusive search for black money.

Dreze, who has done extensive work in India — on issues like hunger, famine and the NREGA — said the government should revive a series of legislative initiatives that have come to a standstill in the last three years, including the Lokpal Act, the Whistleblowers Protection Act and the Grievance Redressal Bill.

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  1. M
    Manivardhan
    Jan 9, 2017 at 1:58 am
    Dreze was correct
    Reply
    1. R
      Rohit
      Jan 9, 2017 at 3:22 am
      The current trend on social media sites is that ANY ONE who opposes and questions with logic, the BJP govt.'s policies are either termed as pro-congress party or as someone pro-corruption/black money. In this case, it is Jean Dreze. Even if he is giving sound logic for an ill-conceived and half baked policy (mind it, good intent itself is not sufficient), the so-called nationals will not spare him and infact b him as totally being pro-Congress party.. C'mon man, for once see his credentials. We Indians have an old habbit of being hyper-sensitive. Without even probing the logic, if we see that someone is raising a concern opposing our pre-conceived stand, we instantly start shooting our verbal nal and give derogatory remarks. Time to introspection, sir @Nitin Rahangdale
      Reply
      1. J
        Jagdish Narayan
        Jan 9, 2017 at 3:24 am
        Mr. Nitin its always not about contesting election and getting or giving citizen ship,by counting other people foults one cannot hide his or her failure.........
        Reply
        1. R
          Rekha
          Jan 10, 2017 at 11:33 am
          Demonetization is a right step when a parallel economy runs along with the real economy that not only increase inflation in the economy but also contribute to build inequalities within society. The only problem this demonetization has created is mismanagement. It is been implemented without ground planning by apex bank like RBI. If RBI should have done that, the problem faced by common people would have been less. As far as the laborer cl is concerned, their payments system is usually weekly basis. We should accept that any change gives little pain but in future results better. As far as economic growth in retail sector is concerned, then i say that this is the real growth of Indian demand. If purchasing power of an average Indian is suffered, then we should draw a conclusion that this is the real PPP of our people.
          Reply
          1. N
            Nitin Rahangdale
            Jan 9, 2017 at 2:23 am
            Dreze, next thing we look forward to is to contest election from Ranchi on UPA ticket. Off course citizenship etc would be a cakewalk. How about a praiseworthy note about Manmohan ...Power of silence etc
            Reply
            1. S
              S.Ramachandran
              Jan 9, 2017 at 12:56 am
              Yes, Modiji bring all the political party accounts into the RTI ambit and bring them to scrutiny . All the MPs, ministers and their kitjh & kind accounts should be probed immediately. All corrupt ministers and politicians should be booked for UN accounted wealth and not the Jan dhaan holders. This only can be named as surgical strike and black money can be eradicated Thanks
              Reply
              1. S
                Surendra Gramopadhye
                Jan 9, 2017 at 4:15 am
                I don't find, unfortunately, the tone of an economist. It appears more to be of a pleader...of the camp, he belongs to.These people forget that BJP has not sold out the political wisdom to take decisions with such wrongful interests.
                Reply
                1. T
                  T.M.Sugumar
                  Jan 9, 2017 at 2:14 am
                  Yes.It is the correct procedure.
                  Reply
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