Demonetisation a fiasco, says CPI-M

The "surgical strike" of demonetisation on black money and corruption has turned out to be a fiasco "coupled with a scam on an industrial scale", the CPI-M has said.

An editorial in the party journal "People's Democracy" said that 36 days after the withdrawal of the 500 and 1,000 rupee notes, ordinary people were struggling to get meagre amounts of cash from their own bank accounts or ATMs.

"Long queues and endless wait outside banks and ATMs continue. There is no cash available for those who need it the most - the casual labourer, the vegetable vendor, the domestic worker and the whole workforce involved in the informal economy," it said.

The Communist Party of India-Marxist, however, pointed out that at the same time, large amounts of new notes were being found in the hands of businessmen, hawala operators, politicians and corrupt bureaucrats.

"The last two weeks have seen income tax raids which have uncovered huge amounts of unaccounted money and that too in brand new 2,000 rupee notes...

"According to one estimate, around Rs 160 crore of new notes were seized from all over the country up to December 12 and this is only the tip of the iceberg."

The editorial went on: "What we are witnessing is a money laundering operation on a grand scale. Instead of curbing black money, what (Prime Minister Narendra) Modi's demonetisation has achieved is to get large amounts of black money converted into white money.

"It has opened new avenues of corruption in the financial system. Corrupt bank officials are conniving with money launderers to make the exchange of notes a large-scale scam.

The government has been clueless on how to check this money laundering through the banks using various devices."

It said the "cashless economy" slogan was being pushed to cover up the fact that the government had miserably failed to produce adequate amounts of new currency notes.

"The 'cashless' drive is thus a bid to divert attention from the currency disaster facing the country."

--IANS

mr/vd