P Chidambaram said Rs 2,000 notes helped people stash black money with ease.
Senior Congress leader P Chidambaram today called the Rs 2,000 note, which has now been withdrawn from circulation, a "foolish move" that only helped people stash black money with ease. Now, these people had been given the red carpet to exchange their currency, said the former Finance Minister.
In an acerbic tweet, his second on the government's decision to scrap the Rs 2,000 note that was introduced after the shock demonetisation of 2016, Mr Chidambaram mocked the government for claiming the high denomination notes were being withdrawn to unearth black money.
"Banks have clarified that no identity, no forms and no proof will be required to exchange the Rs 2,000 notes The BJP's spin that the Rs 2000 notes are being withdrawn to unearth black money stands demolished," Mr Chidambaram posted.
"Ordinary people do not have Rs 2,000 notes. They shunned it soon after it was introduced in 2016. They were useless for daily retail exchange. So, who kept the Rs 2,000 notes and used them? You know the answer. The Rs 2,000 note only helped keepers of black money to hoard their money with ease. The keepers of Rs 2,000 notes are being welcomed on a red carpet to exchange their notes! So much for the government's declared objective of rooting out black money."
Mr Chidambaram added: "The Rs 2,000 note was a foolish move in 2016. I am glad that the foolish move is being withdrawn at least 7 years later."
The government announced on Friday that the notes would be withdrawn from circulation but gave people time till September 30 to either deposit these notes in their accounts or exchange them at banks.
Later, the State Bank of India clarified that people would be allowed to exchange the notes without any form or requisition slip. No identity proof will be required. People can exchange ₹ 2,000 rupee notes up to ₹ 20,000 any number of times in a day.
In an earlier post, Mr Chidambaram said the Rs 2,000 note was a "band-aid" to cover up the "foolish decision" of demonetising Rs 500 and Rs 1,000 notes. The government and the Reserve Bank of India were forced to reintroduce the Rs 500 note weeks after demonetization, he remarked. "I shall not be surprised if the government/RBI re-introduced the Rs 1,000 note as well. Demonetisation has come full circle!" he said.
Though in the 2016 notes ban Rs 500 and Rs 1,000 notes became invalid overnight, the Rs 2,000 notes will continue to be valid, the government has said.
Defending the decision to withdraw Rs 2,000 notes, former NITI Aayog Vice Chairman Arvind Panagariya said it would not have any "perceptible effect" on the economy and the likely motive was to make the movement of illegal money more difficult.