Kerala FM Thomas Issac terms demonetisation ‘a national calamity’
The crisis following the cash deficit has percolated to even the organised sector and will result in a national production loss of Rs2.5 lakh crore, he said.black money crackdown Updated: Dec 03, 2016 19:54 IST
Kerala finance minister Thomas Isaac described the Centre’s decision to demonetise old Rs500 and Rs1,000 notes a “national calamity” which has put the nation in turmoil.
The crisis following the cash deficit has percolated to even the organised sector and will result in a national production loss of Rs2.5 lakh crore, he said.
This has led to people thronging banks and ATMs to withdraw their money. The Reserve Bank has set cash withdrawal cap at Rs 24,000 a week.
“There is going to be a severe downturn. Even if you take 2% (decline in GDP as suggested by former prime minister Manmohan Singh)... it means something like loss of production of Rs2.5 lakh crore...,” Isaac said, adding that the Centre’s move is now impacting almost all sectors of the economy.
He dubbed it as a failed exercise, saying Prime Minister Narendra Modi is shifting the goalpost to cashless economy.
“Whole nation has been put into turmoil. Modi’s demonetisation has become national calamity,” he said.
He countered finance minister Arun Jaitley’s claims of about Rs3 lakh crore expected gains from the exercise, reeling off data that he said suggest about Rs 11.5 lakh crore of the invalid currency have already returned to the banking system.
“Even if you give a very generous estimate of Rs 1 lakh crore (of gains)... you have sacrificed Rs 2.5 lakh crore of national product for unearthing Rs 1 lakh crore of black money. This is an enterprise that has totally failed,” he said.
Referring to 2002 Gujarat riots, Isaac said “he (Modi) looked unruffled, took it in his stride and for various reasons, he was able to take people of Gujarat along with him. I think he wants to do another similar exercise (about demonetisation) at all-India level”.
“What the Prime Minister should understand is that things are getting out of hand. There is a limit to people’s patience. How long can they stand in queues all day... Let us come to our senses. Have a discussion in Parliament, accept something terrible has happened,” the Kerala minister said.