'Failed Move': Opposition Slams Modi Gov't on Fifth Anniversary of Demonetisation

In 2016, Prime Minister Narendra Modi decided that the Indian currency needed a period of demonitisation whereby all INR500 and INR1,000 banknotes from the Mahatma Gandhi series were no longer legal tender in the hope of stamping down on the amount of counterfeit currency in circulation.

After five years of demonetisation in India, the opposition parties have slammed the Narendra Modi government, calling the decision a failed and draconian law.

Trinamool Congress parliamentarian, Derek O'Brien, in a mocking reference to the Modi government's decision to demonetise, shared a screenshot of five tweets sent by the state chief of West Bengal, Mamata Banerjee, on 8 November 2016 - the day Prime Minister Modi announced the currency ban.

At the time, Banerjee had criticised the federal government's move as a "draconian decision".

In other tweets, she criticised Narendra Modi and his government, branding the decision "financial chaos" and a "disaster let loose on the common people of India".

On the night of 8 November 2016, barely hours after #Demonetisation was announced, only @MamataOfficial got it spot on.

Five tweets calling out the draconian decision. (Take a look) #Black_Day_Indian_Economy pic.twitter.com/zpdmkFnZZM

— Derek O'Brien | ডেরেক ও'ব্রায়েন (@derekobrienmp) November 8, 2021

On Monday, Congress politician Priyanka Gandhi Vadra also took to Twitter to criticise the move, using the hashtag #DemonetisationDisaster. Vadra. who is also general-secretary of Congress, wanted to know why demonetisation has not achieved what it was meant to do.

अगर नोटबंदी सफल थी तो

भ्रष्टाचार खत्म क्यों नहीं हुआ?
कालाधन वापस क्यों नहीं आया?
अर्थव्यवस्था कैशलेस क्यों नहीं हुई?
आतंकवाद पर चोट क्यों नहीं हुई?
महंगाई पर अंकुश क्यों नहीं लगा?#DemonetisationDisaster

— Priyanka Gandhi Vadra (@priyankagandhi) November 8, 2021

Congress parliamentarian Shashi Tharoor posted a 35-second video and described demonetisation as "an impulsively conceived decision".

Five years ago today, an impulsively-conceived, ill-thought out, poorly implemented decision knocked the bottom out of our economy. It's time to demand accountability. #DemonetisationDisaster pic.twitter.com/NdGLaJLo7B

— Shashi Tharoor (@ShashiTharoor) November 8, 2021

On the fifth anniversary of the most foolish, whimsical, ill-conceived & poorly-implemented policy ever devised by an Indian government since the days of Mohammad bin Tughlaq, let us bow our head to its victims. #DemonetisationDisaster https://t.co/LufGFZ6g1n

— Shashi Tharoor (@ShashiTharoor) November 8, 2021

On 8 November 2016, Modi announced his government's decision to pursue demonetisation. He said that older INR500 ($6.8) and INR1,000 ($13.7) currency notes would be removed from circulation at that time.

Those were replaced by fresh currency notes in the denomination of INR500 and INR2,000. The public were given 50 days to swap their old banknotes with new ones.

At that time, former prime minister, senior Congress politician and noted economist, Manmohan Singh, called demonetisation a "monumental decision", predicting that it would affect India's GDP by at least two percent.

Five years later, several politicians and activists on Monday took to Twitter and expressed their anguish over Modi's government decision.

5 years since Modi committed the historic blunder called demonetisation which nose dived Indian economy to a stage where we are yet to recover. Remembering those horrifying days when people had to queue up for their own hard earned money. #DemonetisationDisaster pic.twitter.com/1B83sQ8Xg9

— Ramesh Chennithala (@chennithala) November 8, 2021

5 years ago, #demonetisation was announced with just a 4 hour notice by PM Modi. Since then, India's unemployment reached a 45 year high, the economy is at its greatest recession ever, & black money is at an all time high. Notebandi took a healthy economy & sent it to the ICU!

— Dr. Shama Mohamed (@drshamamohd) November 8, 2021

That night. That decision, which broke the back of Indian economy. Hope we'll recover from it soon. #Demonetisation pic.twitter.com/jVRrQzjjxA

— Satish Acharya (@satishacharya) November 8, 2021

5 years to the absolute decisive blow against black money, poverty, terrorism, climate crisis of the planet, midlife crisis of whatsapp uncles, p versus np problem, pen drive inserted upside down problem, and every kind of inconvenience in general.#Demonetisation

— वरुण 🇮🇳 (@varungrover) November 8, 2021

Remember, tomorrow is the 5th Anniversary of the greatest deliberate act of an economic policy disaster in which the Government - yes the Leader of the Government himself - did the equivalent of shooting the nation in both feet. 8 Nov 2016. #Demonetisation pic.twitter.com/TJyIcpi80X

— JayEnAar (@GorwayGlobal) November 7, 2021

India's central bank, the Reserve Bank of India (RBI), in its annual report of 2016-17 stated that demonetised banknotes of an estimated value of INR15.28 trillion ($20.62Bln) (98.96 percent of demonetised notes), were received by 30 June 2017.

The Indian Prime Minister and the ruling Bharatiya Janata Party (BJP) had expected some of the demonetised currency not to come back. Modi had once mentioned that "the 500 and 1,000-rupee notes hoarded by anti-national and antisocial elements will become worthless pieces of paper".

But the RBI later accepted that high-currency counterfeit notes reduced post-demonetisation. According to the central bank, "detection of fake INR500 and INR1,000 decreased by 59.7 and 59.6 percent (respectively) after demonetisation."

Several experts and surveys, however, also suggested that it was due to demonetisation that so many Indians embraced a digital mode for their financial transactions.

From close to 1.5 million digital payment acceptance locations in 2016-17, the number of Indian merchants accepting digital payment modes has increased to more than 10 million in three years, according to a report released in August 2019 entitled 'Fintech in India - Powering mobile payments'.