Former Finance Minister and senior Congress leader P Chidambaram on Sunday launched a scathing attack on the Bharatiya Janata Party-led central government for desperately "eyeing" the reserves of the Reserve Bank of India (RBI) after having "failed" to get money out of demonetisation.
Chidambaram said, "After having failed to get money out of demonetisation, the BJP-led Centre is now eying the reserves of the RBI which is why they have started this problem with the RBI after four-and-a-half years of being in power."
His statement comes in the wake of reports stating that with the RBI's surplus reserve running up to Rs 9.63 lakh crore, the Centre is now planning to ask the bank to fix the norm on surplus reserve.
"Demonetisation was the beginning of the problem. After 'Notebandi', the Finance Minister (Arun Jaitley) said that out of the 15 lakh 44 thousand crore rupees, something like three to four lakh crore will not come back to the Reserve Bank of India and that will be transferred to the Government of India. The Attorney General of India, Mukul Rohatgi told the Supreme Court - and I was present there - that their calculation shows that the government will get a windfall of three to four lakh crore rupees. They got zero. 99.3 per cent of the currency notes came back to the RBI," Chidambaram told media here.
"The government thought they could make a profit, but they got nothing. Today, they are desperate for money. Why? GST collections are short of the target, net direct tax collection is short of the target, the fiscal deficit of 3.3 will not be met. Therefore, they are desperate for money to meet the fiscal deficit target. They also want money because this is the election year and they have always spent. They don't have the money," he added.
"In four-and-a-half years, this was not a problem, earlier they didn't want the reserves. Today when they have effectively got four months before (Lok Sabha) elections, they are eyeing reserves of the RBI," he said.
Chidambaram said that demonetisation is an "ill-conceived decision that derailed the economy."
"In the immediate aftermath of demonetisation, millions of jobs were lost, millions of people were forced to borrow, thousands of MSMEs were shut down, and over a hundred people died while standing in queues. Later, the GDP growth slowed down to 8.2 per cent in 2015-16 to 6.7 per cent in 2017-18. By any account, demonetisation was a catastrophe. In my view, it was an ingenious officially blessed money laundering exercise," Chidambaram said.
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