It has been a month since Prime Minister Narendra Modi announced the cancellation of legal tender to Rs 500 and Rs 1,000 notes. Since then, a lot of water has flown in the Ganga, and a lot of notes too! India has also seen an exponential rise in the number of economists since November 8. Our opposition today seems to have more economists in their fold than the total number of their MPs in Parliament.
After the initial days inertia, the opposition has been very active in coming up with the parameters for the success of the currency ban. Unfortunately for them, their allegations, criticism and propaganda are becoming blunt quickly. While they are clearly aware of their lack of goal scoring abilities, the opposition has been pretty creative with creating new goal posts every passing day to try and portray this step as a failure.
The opposition’s allegations against the government have ranged from hollow to humorous. From inventing Keshav Prasad Maurya’s non-existent daughter holding bundles of cash, to blaming the death of thieves on demonetisation, from the West Bengal BJP’s deposit in the bank to the BJP buying land in different states, the opposition has tried and failed with all its allegations.
A prominent criticism of the government has been that rules are being revised too often. This is not an outcome of inadequate preparation or lack of imagination, but a sign that the government is thinking clearly on its feet. Those criticising the government’s rapid calibrations know, in their hearts, that they neither had the gumption, nor were capable of implementing such a move. There is no global precedent for this step and no best practices exist. There is only a limit till which you can predict human behaviour. But the government has established a robust system to get ground feedback and calibrate its strategy accordingly. It has employed the triad of direct feedback, constant communication and technology. IAS officers were sent to different parts of the country to get feedback and there was constant communication with banks. The prime minister also conducted a survey on his app, in which a record million people participated. While it may be an easy target for the critics, the responsive adjustments have gone a long way in reducing inconvenience.
We were initially told that taking such a large fraction of currency out of circulation would cause such acute distress that people would revolt on the streets. There were warnings and speculation that this move could also provoke riots. That such a massive step could be taken, affecting 125 crore Indians without even a whimper anywhere in the country was unimaginable for a large section of people. There have been also attempts at rumour-mongering about the scarcity of essential items and looting happening at places. In spite of the rumours and the inconvenience, people have kept calm and displayed unflinching trust in the government. In this age of instant Twitter outrage and fake Whatsapp news, people’s support is a clear demonstration of the unparalleled trust 125 crore Indians place in this step taken by PM Modi.
A lot of our leaders suddenly had new-found love for the poor and their livelihoods after demonetisation. We welcome their belated concern. But the fact remains that it is the poor who are the happiest at this move. In spite of the inconvenience, the poor recognise the disruptive potential of this move on their lives. A recent article by academics at the Indian School of Business also comprehensively demolishes the exaggerations by our so-called pro-poor politicians on the difficulties faced by the poor. A recent report also says that total sown area has increased by nine per cent compared to last year, despite the problems farmers may have faced in securing credit. This clearly suggests that our relations-based support systems are thriving in this period.
The next bastion of propaganda is that the government over-estimated the quantum of black money, with the amount of money being deposited. They also allege that once the money goes into the banking system it gets converted into white. Nothing can be farther from the truth. Money being deposited in the banks has multiple benefits. Real incomes and the trend of incomes start getting established. Incomes start getting properly taxed. There is a stiff penalty for all those who have unaccounted money. A large fraction of the unaccounted money will be used for the poor through the PM’s Garib Kalyan Yojana. Most importantly, with the money coming into banks, there will be an expansion of the tax net and tax evasion will become increasingly difficult. Make no mistake, a significant amount of illegitimate wealth will also not return to the banks and go out of circulation forever.
The last and current bastion is a Luddite fear-mongering about digital transactions. There is a scary trend of digital illiteracy among a lot of our intellectual elite. Those indulging in these scare tactics sadly underestimate the intelligence and learning potential of the average Indian. If the poor can connect with their friends on Whatsapp, there is no reason why they cannot conduct their transactions through mobile phones. India is rapidly transitioning to a cashless society through digital transactions and the next few months would be an eye-opener to the naysayers.
The opposition needs to wake up and smell the coffee. India has welcomed this historic move with open arms. The poor won’t be mislead and it is time it stops the theatrics, fear-mongering and propaganda.