Demonetisation is akin to demolishing mountain to catch a rat: Ramadoss

Chennai, Dec 4 (IANS) PMK founder S. Ramadoss on Sunday said the BJP-led government’s demonetisation of Rs 500 and Rs 1,000 currency notes to eradicate black money is akin to demolishing a mountain to catch a rat.

Citing an earlier IANS report, Ramadoss said the report quoting data from Reserve Bank of India (RBI) shows the ground level picture of the demonetisation decision.

Ramadoss said that while the central government contends demonetisation of high denomination notes would result in capture of black money, the news that emanates gives a contrary picture.

He said that on the day (November 8, 2016) when the central government announced demonetisation of Rs 500 and Rs 1,000 notes, the cash with RBI and other commercial banks was around Rs 4.57 lakh crore.

After that, till November 28, the total amount of demonetised currencies deposited with the banks was Rs 8.44 lakh crore.

In other words, a total of around Rs 13.50 lakh crore worth of currency was taken out of circulation, said Ramadoss.

Ramadoss said that by the end of this month, another Rs 94,000 crore worth of demonetised notes are expected to be deposited with the banks, thereby leaving outside around Rs 100,000 crore worth of old notes.

Compared to the size of the Indian economy, this Rs 100,000 crore is not a big amount.

While under the voluntary disclosure scheme, a sum of Rs 65,000 crore of unaccounted money was declared with ease, to recover a sum slightly higher than that (Rs 100,000 crore) is it necessary to create a vortex in the lives of poor and middle class by demonetising the two currency notes. "The government should ponder," Ramadoss said.

He said the amount is low when compared to the economic impact the central government’s decision had on trade and manufacturing sectors.

Ramadoss urged the government to put into circulation more currency notes so that the people are not put to hardship any longer.