Weeks after Prime Minister Narendra Modi announced
his demonetisation plan, economists were worried
about its impact. Former prime minister Manmohan
Singh also expressed reservations about the move. However,
data for the October-December quarter has shown that the
economy is growing at a robust 7 per cent and the good news is
that India will retain its rank as the fastest growing economy.
There was a fear that demonetisation would cause the growth
rate to fall below that of China, but data has shown that this
is not likely to happen. The data was better than the estimates
of chief economic advisor to the government who had pegged
growth at 6.5 to 6.75 per cent. Experts however are still skeptical
and there is merit in their argument that the real effect of demonetisation
would show up in the fourth quarter. Economic
indicators apart, demonetisation put a lot of people through a
long spell of hardship. Daily wages could not be paid in many
sectors and thousands of man-hours were wasted standing in
queues outside banks. The data will come as a relief to the government,
but the nation still remains clueless as to how much
black money was unearthed in the process.
