It will take 7 months to replace equivalent of banned currency: P Chidambaram

Hyderabad: The nation was totally unprepared when Prime Minister Narendra Modi surprised everyone by abolishing Rs 500 and Rs 1,000 notes on the evening of November 8. But perhaps the Central government itself is unprepared to fill the void brought on by the banned currency.

Former finance minister P. Chidambaram in a TV interview said that it would take seven months to replace the equivalent of the banned Rs 500 and Rs 1,000 currency.

Even with the introduction of Rs 2,000 notes, which was done to save time, it will take another five to six months to replace the old notes he said. “They have blundered. They are trying to race against time. There were 1570 crore notes of one denomination and 530 crore notes of another denomination – a total of 2100 crore notes. The capacity of printing presses is 300 crore notes per month. If they wanted to replace 2100 crore notes with the equivalent denomination notes, it would take them seven months to print them. That is why they introduced Rs 2,000 notes. There is absolutely no economic justification. “…Nobody has answered my question. When you are so called demonetising Rs 500 and Rs 1000 notes, why do you introduce Rs 2,000 notes? I will tell you why, they introduced Rs 2,000 notes only to save the number of notes they have to print. It will still take five to six months to print; if they want to print Rs 100 notes, it will take five times more time. This shows who unprepared they were,” he said.

This is not economic move but a political one, says Jairam Ramesh
Warning of a negative impact on GDP for next one year, Congress on Thursday said Modi government’s demonetisation move was more political than economic. “I confidently say this not an economic brahmastra but a political one,” party spokesperson Jairam Ramesh said, stressing the prospects of a recovery in rural, agriculture and unorganised economy in the country are remote in the next year.