COLUMNIST and professor of International Studies and Social Sciences at Brown University Ashutosh Varshney Tuesday criticised the Union government for Monday’s proclamation to not permit more than a one-time deposit of over Rs 5,000 up to December 31. He also said the unfolding situation around the demonetisation of currency notes of Rs 500 and Rs 1000 denomination had dented the credibility of the Reserve Bank of India.
Questioning the government’s move to issue 59 proclamations in 50 days on the subject, he said. “Yesterday’s order changes what it promised the citizens on November 8.”
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Delivering a talk on ‘India’s Democracy: Paradoxes for further reflection’ at the Professor Rajni Kothari Memorial Lecture Series at Tata Institute of Social Sciences, Varshney said monetary policy was the domain of central banks all over the world.
“RBI is an autonomous institution supposed to have the final say on the monetary policy of the country. Are we sure that the RBI’s wishes have been consulted? I find it hard to believe that the RBI would issue 59 proclamations in 50 days. That is not how central banks function. This destroys the legitimacy of RBI,” said Varshney.
Accepting that demonetisation was popular among the masses for the first two weeks, he said it was not popular anymore.
“By not allowing over Rs 5,000 deposits, the government wants to show that it does not favour the rich,” said Varshney, also a contributing editor for