Chennai: Terming demonetisation as an "economic gamble" by the BJP-led Centre, media advisor to former Prime Minister Manmohan Singh, Sanjaya Baru on Sunday said the Assembly elections in Uttar Pradesh and Punjab would be the "real test on the success" of the scheme.
"All the businessmen whom I know and who had celebrated Mr Modi's victory in May 2014 are unhappy now. There is lot of unhappiness among the rich (due to demonetisation)," he said.
"It is this unhappiness among the rich that will alienate some part of voters who voted for Modi in May 2014", he added. Baru was speaking at a seminar here on "Demonetisation - A Gamble or a Game Changer" organised by the Triplicane Cultural Academy and Kasturi Srinivasan Library.
He said the real test on the success of demonetisation will be the outcome of the Assembly polls in Uttar Pradesh and Punjab.
"If BJP does reasonably well even if they do not get any majority, Mr Modi can say I have succeeded. But if they do badly, then a new momentum will come into Indian politics", Baru, also the Director of Geo-Economics and Strategy
International Institute for Strategic Studies, said. "What we have seen in the last two months (soon after demonetisation was announced) is an economic gamble and we are yet to see the consequences of the gamble. Was it an economic game changer? That will be a big question," he said.
He said the reason he termed demonetisation as an economic gamble was because there was no precedent before it. India never had any historic situation where demonetisation had been done in the past, unlike Germany or Zimbabwe where demonetisation was announced, he added.
"Desperate situations call for desperate measures. Demonetisation has been done in various countries like Germany and Zimbabwe. But these were situations where their economies were in chaos and crisis.
"When you are in crisis you take desperate measures. But when (Indian) economy was growing at seven per cent and when we have a normally functioning economy, this (demonetisation) has been done", Baru said.
He argued that all economists who had been talking of demonetisation did not have any historical basis to what they were saying.
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