On November 8 AT 8pm, PM Modi stunned the nation by announcing immediate demonetisation of high value currency notes of Rupees 1000 and 500, accounting for 84% of the total currency in circulation. According to him, the move was being undertaken to curb black money in the economy, stop terror financing, flush out fake currency and punish holders of unaccounted or black money. Those were the stated objectives!
But, it is now becoming increasingly clear that Modi had resorted to this step with a political motive in mind. His attacks on the opposition parties for criticising the move, show that he is trying to paint the opposition as villains who are in cahoots with the criminals and tax evaders and the filthy rich, who he alleges have looted the nation and by implication the poor since independence ! In other words, he is posing as the messiah of the poor, who constitute a majority of Indians. That he intends to encash on this at the upcoming assembly elections in UP, Punjab, Uttarkhand etc shows that there was a political motive behind the move.
However, the move which initially received broad approval is running into a wave of anger and mounting frustration, as queues get longer and people waste several hours of their valuable time to exchange the old valueless currency for new. The mounting criticism by members of the public for the pain being inflicted on them is a factor that was not taken into account. The scheme appeared to have been executed in great hurry without considering the probable bottlenecks that could arise. India is basically a cash and carry society. Plastic money including credit cards have not penetrated the urban areas let alone the countryside. With ATMs slowly making their presence felt, cash is still the preferred source of money. And most of it is held by hundreds of millions of our countrymen right at home, particularly in the villages.
This important fact should have been taken into consideration. With 1000 notes accounting for 39% of the currency in circulation and 500 notes over 45% the Modi govt failed to realise that most of this amount was held by the hundreds of millions working class including farmers, labourers, small traders, fruit and vegetable vendors, milkmen, auto rickshaw drivers, dhobis, fishermen etc, etc. All honest citizens who earn by the sweat of their brow! By demonetisation, the Modi govt has inflicted suffering on these sections of society, All over the country, millions are queuing up daily to exchange the valueless currency notes for the new legal tender. Many are returning home empty-handed as banks run out of cash within a few hours. Worse, most of the ATMs are either closed or shut within an hour or two as they run out of cash. The delay in recalibration of ATMs to accept and dispense the new currency notes has also contributed to the agony of the people.
Modi’s utter lack of sensitivity has been exposed by his comments about scamsters standing in queues to exchange the old notes and the rich not getting sleep post demonetisation. Does he imply that the tens of millions of people standing in the queus are rogues? And are all rich people crooks? Have we noticed something thing? You don’t see many netas or rich people in queues, do you? Neither Bollywood actors nor sportpersons! It’s by and large the poor, the lower middle class and vulnerable sections of society. Public anger is mounting as people struggle to get back their own money.
Realising that the plan is going awry, Modi is trying to deflect public anger by attacking opposition parties. It’s a classical case of the pot calling the kettle black. In the run-up to the 2014 Lok Sabha elections, Modi and the BJP are alleged to have spent hundreds of crores of rupees in the campaign. Modi himself crisscrossed the length and breadth of the country by air. Have these expenses been disclosed and their sources? Crony capitalists have been very generous in providing funds and fleets of air planes and helicopters. Why have these resources not been made public?
It does not behoove the PM nor his party, the BJP to take the high moral ground. It’s refusal along with the Congress party to come under the purview of the Right to Information act shows its lack of sincerity. The other lacunae is that both these and other major political parties take shelter under the clause that names of donors of contributions below Rs.twenty thousand need not be disclosed . It’s an open secret that major political parties use this clause to split bigger donations into lots of contributions below Rs.tweny thousand to evade scrutiny. And the BJP is among them!
Demonetisation of itself will not be effective in excising the cancer of black money. Most of the ill gotten wealth is not held in cash. It’s been already converted into investments in realty, bullion and foreign currency, besides invested in benami businesses all over the country. Possibly, the exercise conducted at a high cost, may be an exercise in futility as far as eradication of the cancer of black money in the Indian economy is concerned.
Perhaps the most important step that the govt should take is to work towards state funding of elections. Only then would the unholy nexus between politics and black money be broken. PM Modi must keep the momentum going. The important question is, ‘Are the politicians ready to turn to transparency and clean politics?’. The time for a makeover has arrived . Will our politicians of all hues rise to the occasion?
(The author is a retired bank
manager)
