New Delhi, Nov 23: Looking at the current social, political and economic scenarios, the debate on demonetisation is unlikely to end soon.
While on one end Prime Minister Narendra Modi and his cabinet colleagues are regularly addressing the masses and insisting that the "tough" economic decision had to be taken to destroy the black money economy, critics of demonetisation feel that it is a hasty decision that has adversely affected the country's economy.
Economic historian and professor at Centre for Historical Studies, Jawaharlal Nehru University, New Delhi, Rajat Datta in his viral Facebook post states that India's informal sector is all set to be decimated by demonetisation.
[Also Read: Survey: Thumbs up to demonetisation, it's a "surgical strike" against black money]
"In the informal sector (our famous jugaad' sector) where credit is hardly available as sureties or collaterals can't be easily found, lending rates can be as high as 36 percent or more," Datta writes.
"All of us who enjoy the privilege of holding credit cards should try rolling our amounts due for a month or two to see what a compounding interest of 40 percent a year looks like. No wonder there is an almost total dependency on cash usage in the informal and agricultural sectors, and hence the massive anxiety when it is/was suddenly withdrawn," he adds.
According to Datta "jugaad" sector employs 90 percent of country's non-agricultural labour.
"A sector which contributes 46 percent of India's GDP, and employs 90 percent of India's non-agricultural labour, almost entirely paid in cash wages, is all set to be decimated by this demonetisation," he says.
"This will have a telescoping effect on the formal sector as it sources many of its peripherals from the informal sector," Datta adds.
Read his entire Facebook post below: