Manmohan Singh came out of retirement to speak on the demonetisation of Rs 500 and Rs 1000 notes in the Rajya Sabha on Thursday and made perhaps the most impact the Congress has made in the matter so far.
Sure, Rahul Gandhi stands in every ATM line he can now find, P Chidambaram has called it ‘demonisation’ and Anand Sharma has spoken with much drama in the Rajya Sabha, but finally it was the former Prime Minister who landed the most telling blow for the party so far.
It helps that he’s a respected economist, but here’s why he possibly struck a chord:
It felt neutral and dispassionate: The former Prime Minister was never known for his emotion, and it was perhaps his undoing while in power. But on Thursday, he said he was for neither side and just wanted the scheme implemented properly. The dispassionate speech was the reason everyone outside of the Rajya Sabha listened to him when he spoke on Thursday. It wasn’t a weepy speech about caring about a mythical poor person but listing practical problems with the implementation of policy.
He attacked the implementation, not the scheme: Others have asked for the rollback of the scheme, but Singh seemed to have realised the impracticality of doing that. He, in fact, praised the intention of the scheme, which is what many people feel. It’s not the idea that people have had a problem with, it’s the fact that they’ve to face inconveniences. He said what many Indians might have thought at some point: this is a great idea, but couldn’t this be a little more painless?
He hit with numbers: Over 60 dead, a potential GDP decline of 2 percentage points. These aren’t his numbers, but Singh used them well to highlight that it’s not just a problem for the people, it will also hit the economy. And given his experience with a falling economy, it’s worrying when he says this could result in a dipping economy.
He was eloquent: He quoted Keynes to hit back at Modi supporters who say we should look at the big picture saying “in the long run, we are all dead”. He called the scheme a “case of organised loot and legalised plundering”. He pointed out that this could “erode people’s confidence in currency and banking system”. The former Prime Minister isn’t known for his verbal jousting skills (search Manmohan Singh memorable speeches on YouTube to get an idea) so when he makes a relevant speech it’s no surprise that we’re paying attention.
He pointed out the problem with the RBI: Ever since the announcement was made on November 8, the one voice that has been completely missing is that of the central bank governor Urijit Patel. It has sparked memes, but also raised doubts about the independence of India’s central bank under the current government. The RBI is supposed to manage money flow in the economy, so why isn’t the RBI governor revealing this scheme’s potential impact on growth and how it will handle this fallout, as this BloombergQuint piece asks. The ex-Prime Minister, who is also a former RBI governor, said he was saddened by the RBI’s handling of this scheme and he’s brought a much needed focus on the functioning of the central bank.