Demonetisation Undermines The Right To Food And The Right To Life

30 December 2016

 - The right to food campaign is dismayed by the Indian government’s reckless attempt to renew currency notes, known as “demonetization”, without any serious attention to the consequences it may have for poor people. This move serves no clear purpose and is a major attack on the right to food and the right to life.

Demonetization was sold to the public by claiming that it would flush out the black economy. In a rare display of near-unanimity, economists of all persuasions have exposed this misleading claim. Illegal income is not usually held in the form of wads of cash. It is spent, invested, laundered or converted in other ways into safer and more profitable stores of value than currency notes. That is the main reason why the bulk of old Rs 500 and Rs 1000 currency notes have found their way back to the Reserve Bank of India during the last two months, contrary to the assumption that demonetization would leave crooks with large amounts of unusable notes.