Demonetisation of currency notes will completely destabilise the economy as it comes on close heels of the goods and services tax (GST) implementation, West Bengal finance minister Amit Mitra said here.
“Demonetisation will be a double whammy for the poor,” Mr. Mitra said. “It will completely destabilise and disrupt the entire process of economic activity and the GDP (Gross Domestic Product) will collapse. With GST, there is a destabilisation already underway.
That is why the states are being compensated for five years for losses arising out of the transition under the GST.”
Mr. Mitra said while the circulation of counterfeit currency notes in the economy was estimated to be about Rs.400 crore in 2014 “according to government’s own intelligence unit,” the demonetisation exercise will cost Rs.14.5 lakh crore to the economy.
“Is this move for combating black money or is there a hidden agenda?” the West Bengal finance minister asked.