Kaushik Basu flays demonetisation, says it is likely to fail

While Kaushik Basu is supportive of the intent behind the policy, that of dealing with the large black money economy in India, he said the move was â€˜ham-fisted‘ that will put only a temporary dent in corruption and is likely to rock the entire economy.

November 29, 2016 / 12:07 IST

Former chief economic adviser to the government Kaushik Basu has criticised the Centre’s demonetisation of Rs 500 and Rs 1000 currency notes, saying it was badly implemented and likely to fail.

Basu made the comments on Sunday in an article in the New York Times.

He is currently the C Marks Professor of International Studies and Professor of Economics at Cornell University in the US. He served as chief economic adviser to the Indian government from 2009 to 2012 and was chief economist of the World Bank from 2012 to 2016.

“Demonetisation was ostensibly implemented to combat corruption, terrorism financing and inflation. But it was poorly designed, with scant attention paid to the laws of the market, and it is likely to fail. So far its effects have been disastrous for the middle and lower-middle classes, as well as the poor. And the worst may be yet to come,” Basu wrote.

He also criticised the poll conducted on Prime Minister Narendra Modi’s App. While he is supportive of the intent behind the policy, that of dealing with the large black money economy in India, he said the move was ‘ham-fisted’ that will put only a temporary dent in corruption and is likely to rock the entire economy.Read more at News18.

first published: Nov 29, 2016 08:50 am

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