Watch: Rajya Sabha MP Narendra Jadhav Explains Why He Supports Demonetisation

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As we near the 50-day deadline for the exchange of demonetised currency notes, Narendra Jadhav talks to The Wire‘s founding editor why he supports the move and answer questions about how he thinks demonetisation, along with other planned moves to curb corruption, is going to affect our economy in the long term.

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  • Arnab Basak

    I dont understand. Mr Jadhav says banks will lend more as they are flush with cash. Lets say that 13.5 lakh crore came back into the banking system. Lot of this would be legitimate money which would eventually be withdrawn by the public or wont/cant be taxable. And digging out the illegitimate/black portion of it and then taxing it would need Income Tax scrutiny, which could take years, with doubtful returns. So how do the numbers add up here?
    The ONLY WAY banks can lend this money worth 13.5 lakh crores is if the restrictions on cash withdrawal continue for say the next few months despite enough cash having being printed. And I consider that to be a highly immoral and unethical step, because the government is then truly indulging in “organised loot”, a kind of reverse Robin Hood scenario – forcefully taking from every citizen including the poor and giving to the corporates as bank loans, while ignoring and waiving off the 10 lakh crores or so of loans they gave to those same corporates over the years!
    What logic justifies this?