Chidambaram: Demonetisation ‘official money laundering scheme’, govt wants to capture RBI

Calling demonetisation an "ingeniously designed official money laundering scheme". Congress leader and former finance minister P Chidambaram on Thursday said PM Narendra Modi's promise of ‘acchhe din’ was in shambles as none of the objectives of demonetisation materialised. “GST collections, as well as direct tax collections, are short of estimate. The government will not be able to meet the fiscal deficit target of 3.3% for 2019,” he said at a press conference in Kolkata.

Commenting on the rift between RBI and Central government, Chidambaram accused the Narendra Modi government of trying to "capture" the Reserve Bank of India to tide over its fiscal crisis, warning that any such move would be "catastrophic".

He alleged that the government has packed the central bank's board with handpicked nominees, and was making every attempt to push through its proposals at the RBI board meeting on November 19.

"The government stares at a fiscal deficit crisis... The government wants to step up the expenditure in an election year. Finding all avenues closed, in desperation, the government has demanded ₹1 lakh crore from the reserves of RBI," the former finance minister said.

"The day of reckoning is November 19 when the RBI board is scheduled to meet. The government has packed the RBI board with its handpicked nominees and is making every attempt to ram through its proposal at the meeting," Chidambaram said.

"If the RBI either defies the government or RBI governor resigns, in either events, the consequence will be catastrophic," he added.

Commenting on the upcoming elections and Congress positioning, Chidambaram said a state-wise alliances would benefit the party and was the best way to defeat the BJP.

Apparently emboldened by the victory of the ruling Congress-Janata Dal (Secular) alliance in the recent Karnataka by polls, Chidambaram said similar alliances should be formed in other states as well.

"The kind of alliance formed in Karnataka, it yielded results. Similar alliances should be formed in different states," he added.

Asked about the party's alliance in West Bengal, the former finance minister avoided a direct reply, saying, "The AICC will take a decision in this regard." Chidambaram also alleged that the Narendra Modi government has completely failed and the BJP has gone back to its Hindutva agenda.

With PTI inputs