Hitting out at economists for criticising demonetisation, Niti Aayog member Bibek Debroy has said that critics are unaware of the government’s financial inclusion programme and their understanding of the situation is based on views expressed in English language newspapers.
“They (economists living abroad) base their understanding essentially on reading English newspapers. Otherwise, how would they know? English language newspapers understood many things wrongly,” Debroy told reporters when asked to react on comments of former World Bank Chief Economist Kaushik Basu and other economists who have criticised demonetisation.
“Where does Dr Basu work now? He is based in US. I have a great deal of respect for him…That someone who is away from India may not necessarily be aware what is happening in India,” he added.
The eminent economist said Basu will probably react to things like financial inclusion on the basis of data that is three years old, adding, “He (Basu) does not know what happened as a result of Pradhan Mantri Jan Dhan Yojana (PMJDY).”
Under PMJDY, 25 crore bank accounts were opened. Basu, who was also Chief Economic Advisor in Ministry of Finance, had on November 11 said that Modi government’s decision to demonetise high denomination currency notes is not ‘good economics’ and the collateral damage of demonetisation is likely to far outstrip the benefits.
Lawrence ‘Larry’ Summers, a former chief economist of the World Bank and ex-economic advisor to the US President had described the Indian government’s demonetisation steps as the “most sweeping changes in currency policy in the world in decades.
This (Indian government’s demonetisation steps) is ‘unlikely to have lasting benefits’ and that it has resulted in ‘chaos and loss of trust in the government’,” Summers was quoted as saying.