A lecture by Prof. Suresh Babu
At 5.30 pm on Wednesday, the 25th of January, a group of faculty and students assembled at the Central Lecture Theatre for the first lecture organised by the faculty association, in an upcoming series of lectures. This sort of faculty colloquium is a continuation of a tradition of regular talks that used to be held in the Institute around 30 years ago. On the last Wednesday of every month, a professional lecture on a popular topic will be organised in order to create of a forum for better sharing of information, with a wide appeal. This series was inaugurated by Professor Suresh Babu, Associate Professor of Economics, Department of Humanities and Social Sciences, who gave the first talk on ‘Demonetisation: Some Issues’.
Professor Suresh Babu started off by saying that there was no other economic policy that has affected almost all Indians instantaneously like demonetisation. The decision by the Modi led government to ban Rs. 500 and Rs. 1000 notes on November 8th, 2016 has had a massive impact on the country and its people. He stated this this talk would not produce a verdict as to whether this policy was good or bad, but would present us a general overview and raise some important questions. His talk started with presenting some statistics and evidence, went on to outline some ignored facets of the economy in the making of this policy. He talked about the inequality in the Indian society, in terms of the rich-poor divide, the gender gap and education level. Also, he stressed upon the fact that 90% of economic transactions in India are through cash and that majority of India worked in the informal sector, and thus, such a drastic move was bound to have dramatic effects. He also showed statistics of fall in several major sectors of the economy post demonetisation.
He also stated that the objectives or intentions of the policy makers were completely valid. Estimates place the value of Indian Black Money at 23 percent of Indian GDP. It is a colossal problem that persists in India, along with the problem of fake currency. However, the implementation of the policy has raised two very important questions that we have much to debate upon. One is, whether the Indian banking system has the capacity to carry out such a mammoth task, and two, does the merit of this policy justify the pain it has inflicted. Other important topics of discussion this policy has brought to the light is what is our economic rights as citizens of this country, and also scrutiny of previously sacrosanct institutions like the RBI. After concluding his talk with giving us all a lot of fodder to think about, the session concluded with opening the floor to questions and comments from the audience.
About The Author:
Professor Suresh Babu has an MA from Pondicherry University and PhD from JNU, New Delhi. He has been a Research Associate at the Centre for Development Studies, Trivandrum and Gokhale Institute of Politics and Economics, Pune. He specializes in Industrial Economics and Applied Macroeconomics.
-By Sanjana B Acharya
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