26 October, 2020

“You Are Reducing Black Money Without Stopping Its Sources”

Economist Abhijit Sen on how Modi is planning a greater tax intake buying into the idea of a transition to a cash-less economy.

Photograph by Tribhuvan Tiwari
“You Are Reducing Black Money Without Stopping Its Sources”
outlookindia.com
2016-11-11T16:50:03+05:30

Former chairman of the Commission for Agricultural Costs and Prices, economist Abhijit Sen, in an interview with Lola Nayar, explains that Prime Minister Narendra Modi is planning a greater tax intake buying into the idea of a transition to a cash-less economy. Sen ­expects a tax amnesty scheme to follow ­demonetisation.

How do you see the demonetisation ­affecting the economy?

I don’t know how the whole thing was thought of, but given the fact that 500 rupees is not exactly a very large amount nowadays compared to either the wages—it is two days wages roughly for daily-wagers—or the fact that it is a very large part of the currency in circulation, it must have some pretty strong effect. At least in the short run, the cash economy, which is 50 or possibly 60 per cent (we don’t know exactly what the number is) will be drastically effected. We can certainly expect it to slow down for the first one week, then people will find jugaad to get around the whole thing, but some of...

unsub

THIS ARTICLE IS PRICELESS...

To read this piece, and more such stories in India's most exciting and exacting magazine, plus get access to our 25-year archives goldmine, please subscribe.


More from Lola Nayar


Latest Magazine

November 02, 2020
content

other articles from the issue

articles from the previous issue

Other magazine section