Demonetisation: Pakistan, Venezuela unwilling to go the whole way like Modi on note ban

Prime Minister Narendra Modi's demonetisation move appears to be popular, at least politically. It has been echoed in at least two other developing countries, where Venezuela and Pakistan have taken a similar route.

Written by Radhika Iyengar | Updated: December 20, 2016 7:31 pm
A customer holds a stack of 100-bolivar notes at a bakery in downtown Caracas, Venezuela, Monday, Dec. 12, 2016. Venezuelans are rushing to spend their 100-bolivar notes after a surprise announcement that they will be taken out of circulation this week. President Nicolas Maduro said on Sunday that his government would be pulling the bills to stop the "mafias" who smuggle contraband on the Colombian border. (AP/Photo/Fernando Llano) A customer holds a stack of 100-bolivar notes at a bakery in downtown Caracas, Venezuela. President Nicolas Maduro said on Sunday that his government would be pulling the bills to stop the “mafias” who smuggle contraband on the Colombian border. Source: AP/Photo/Fernando Llano

Despite the immense hardships faced by people across India, Prime Minister Narendra Modi’s demonetisation move appears to be popular, at least politically. It has been echoed in at least two other developing countries, where Venezuela and Pakistan have taken a similar route.

Last weekend, Venezuela’s President Nicolas Maduro took the decision of scrapping 48 per cent of the country’s currency by withdrawing the 100 bolivar bill. Like Modi, who informed India that the step was taken not only to weed out black money, but to also falter the functioning of terrorists, Maduro told his citizens that the drastic measure was taken to circumvent Venezuela’s inflation (IMF made a forecast of it hitting 475 per cent this year), while also battling the transnational mafias breeding in the country.

However, in contrast to the four hours India was given to spend its old notes, the Venezuelan government gave its people a period of three days to use the 100 bolivar notes. In addition, the people were given merely 10-day window to transfer their money into their bank accounts, while the Indian government had given its people 50 days.

Like India, the result was inevitable: Venezuela plunged into chaos. Unlike India however, the people’s response to the move was different. Maduro is no Modi. Almost immediately, protesters in Venezuela blitzkrieged the streets, destroying shops, blocking roads, breaking down ATM machines and wrecking havoc. The mood of the crowd was angry, intense, and unified.

WHAT ELSE IS MAKING NEWS:

Remarkably in India, despite the move that has slowed down our economy and broken the backbone of the agricultural sector in particular, no one is protesting. Indians are known to protest. It’s in our blood. If something doesn’t sit well with us, we raise an alarm. Of course, there have been pockets of disruption: there was the nation-wide protest under the banner of ‘Jan Aakrosh Diwas’ for instance, which unfortunately failed to make an impact. The reason for that protest to fizzle out, however, was that the politically-led protests in different parts of the subcontinent weren’t unified in voice and spirit. They had their own agendas in place. Not many wanted to join hands and fight for a united cause.

The mild murmur of protests could possibly be linked to people’s inhibition to display any form of disagreement with the government. Demonetisation has been intelligently paired with the anti-national narrative: if anyone questions or challenges the move, he/she is unpatriotic and possibly in possession of black money. There are many who, therefore, refuse to speak out because of the overwhelming fear of being attacked for voicing dissent.

Today, Pakistan announced that it would cull Rs 5000 notes from circulation. Out of the 3.4 trillion notes in circulation, 1.02 trillion –about a third — are in this high value. It’s therefore, not as drastic a step as the one taken by Modi who withdrew over 86 per cent of the currency. Modi did not take the issue to Parliament to maintain secrecy. Pakistan in comparison, approached the Senate before announcing the decision. In November, Pakistan had also publicly declared that these notes will be devalued. This makes the whole move less severe, less messy, and strategically, better planned. Unlike India, Pakistan’s move seems to be taken cautiously, possibly wary of the crippling consequences India is experiencing right now. It has decided to spread out demonetisation over a period of three to five years, slowly pulling out the notes “in a phased manner”.

Interestingly, Venezuela’s President has temporarily stalled the decision to demonetise the economy, particularly after the protests and the death that was reported. There are a few who commend him, saying that unlike Modi who refuses to acknowledge the issues and retract demonetisation, at least Maduro is paying attention to the mood of the people. However, there are others who’ve argued that President Maduro is an unpopular leader, and the fear of being ousted through a military coup was probably what prompted him to pull back the note ban.

Historically,Venezuela has been marred by series of coups where political leaders have been uninhibitedly overthrown. For instance in 2002, Venezuelan President Huga Chavez was removed from power by a military coup, leading to the annulment of the country’s constitution. Pedro Carmona, a business leader replaced him. Prior to that, Venezuela has witnessed several military coups – 1945, 1948, 958 – that have seen Presidents being overthrown.

In comparison to Maduro, Modi enjoys immense popularity. Over the years, he has been able to build a strong image of himself, where a majority of the country believes he heads a “transparent” government and has great decision-making skills. So even though demonetisation has led to numerous deaths; even though economists predict the National GDP will plummet by two percent (which they call an under-estimation), the idea to publicly overthrow him, replace him or denounce him, seems unthinkable.

Therefore, while Maduro may have withdrawn demonetisation because of political threats, Modi will be unwilling to do so. It will be a political suicide if he even considers it, some argue. When Modi announced the note ban on November 8, he asked the citizens to invest faith in him. If he appears to falter in his decision now, it will collapse the awe-inspiring image he has skillfully built over the years. What’s more disconcerting is government calling the numerous deaths in the country and other inconveniences caused by demonetisation as “temporary pain for larger gain”. Of course all of us have been told what the so-called ‘larger gain’ is, but there is no certainty whether it will be achieved.

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  1. S
    Sri
    Dec 20, 2016 at 3:50 pm
    This author is obviously one of the "affected ones". Clearing current deficit using the current plan may favour some of the big business but please consider the larger good this will bring to the nation.
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      Ashu Kumar
      Dec 20, 2016 at 5:59 pm
      Our PM is renowned Jumlebaaz so public is dreaming about aache din. Moreover he has well knit Sena of Bhakts who are busy in making fool of public through dramabaazi. After 30 Dec. Public may show their anger.
      Reply
      1. G
        G YAGNESWARAN
        Dec 21, 2016 at 12:59 pm
        Lengthy peripheral write up.
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        1. G
          Gautam Patel
          Dec 20, 2016 at 3:42 pm
          WHEN WILL THIS AUTHOR AND INDIANEXPRESS LISTEN TO PEOPLE????? They seem to be convinced that the people are not demonstrating in India is because opposition is not united and sleuth of other reasons. They do not seem to understand or care to understand people of India. They are so blinded by their own conviction about demonetization that they come up with all kinds of fictional rationales to represent why people of India are not upset. The author Radhika does not understand a simple fact that people of India has highlighted over and over. THEY ARE HAPPY, EVEN THOUGH THEY HAD TO STAND IN LINE AND SUFFER INCONVENIENCE, BECAUSE THE MOVE IS HITTING IN GUTS OF CORRUPTION (AND THOSE WHO ARE CORRUPTED), FAKE COUNTERFEITING MAFIA (STAN, DAWOOD,...), AND TERRORISM. Also the fact that someone is willing to take such strong step in the interest of country after many decades of pervasive corruption. All this happiness is much larger than the inconvenience the people of India faced. And hence no widespread violence and protest. It can be summed up in one simple phrase - 'sau sunar ki aur ek lohar ki'. This was one blow on behalf of common people who have suffered hundred blows in past many decades.
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            gopal
            Dec 21, 2016 at 3:57 am
            Writer is under the impression that note ban is not effective in other countries..every country will initiate a high denomination demonetization soon after seeing the success in India. 2 groups will continue to complain on demonetization even after 100 years ..they are the so called economists and the Indian Media..nothing can be done about that.
            Reply
            1. U
              Umesh Suri
              Dec 20, 2016 at 2:54 pm
              The author appears to be biased. Probably a left or black money dons sponsored article.
              Reply
              1. H
                Hari
                Dec 20, 2016 at 3:12 pm
                Is the author gone nuts or part of IE to spearhead chaos in India. I suggest media houses should also be raised and cancel license if found caught with unaccounted money. Atleast author needs a refresher training before making these articles.
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                1. G
                  Guest
                  Dec 21, 2016 at 4:02 am
                  No one new Modi before Gujarat macre of Muslims. his only qualification was that he killed 10000 Muslims in Gujarat by organizing riots, that is why hate filled upper case Hindus voted for him and rest lower cast Hindus where fooled by Gujarat developmental stories which were just gas. Let those people suffer now who choose as m murder and an illiterate pretty criminal as PM.
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                  1. J
                    Jawad
                    Dec 20, 2016 at 5:38 pm
                    Agla Gira tu pechla hoshyar.
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                      arvij
                      Dec 20, 2016 at 4:06 pm
                      Typical Congress motor-mouth crony. Venezuela has vicious black market and 0ne Bolivar is sold, by even the Police, in exchange six dollar at least. Such is corruption. Inflation is astronomical . Greed of the Spanish potion ("White") over the original people knows no bound. And Pak is s terroist state run by the corrupt for the corrupt . Any compares these countries with India's current leadership must be as neurotic as Chief minister of Delhi, Kim Jong Un Of India.
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                        Guest
                        Dec 21, 2016 at 7:00 am
                        You forgot Godhra macre of Kar sevaks...
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                        1. S
                          Shubham Kukrety
                          Dec 20, 2016 at 6:36 pm
                          A writer likes to be liked. A writer also likes to speak his/her heart out. I can understand this might not precisely be "your" viewpoint of the overall situation (although, a concessional benefit of doubt is still in order), so I'd rather shift the blame on our beloved Indian Express.lt;br/gt;But please do try to understand that no matter how crafty the writing might be, people can still separate the truth from deception.lt;br/gt;I feel sorry for you.
                          Reply
                          1. M
                            madhav
                            Dec 20, 2016 at 3:07 pm
                            There is an old saying, if you can not dance, simply complain about the courtyard. Other leaders understand the problem of their subjects and value them, unlike ours. lt;br/gt;lt;br/gt;If a farmer could not get his daughter's marriage conducted in a way he wanted, that is a small inconvenience. But in marriage 500 crore is spent is very small function. When huge number chartered planes brought guests for marriage, it was a personal function. Only double standards. One for the common man and other for the influential.
                            Reply
                            1. J
                              Jay
                              Dec 20, 2016 at 3:42 pm
                              The author seems to have too much empathy for the FSA or Levant of Aleppo and keeps the policy makers of stan in high esteem for their truly inspiring strategy on demonitisation(Wow!!).A true so called "neo-liberal" .Keep writing so that people will understand more on the already exposed current day liberal journalism is.!!
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                                Niharika Sharma
                                Dec 20, 2016 at 3:35 pm
                                Radhika Iyengar is a known doomsday sayer and her article should be read for enjoyment and humour. Keep up the good work.
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                                1. R
                                  rahul
                                  Dec 20, 2016 at 2:34 pm
                                  "...at least Maduro is paying attention to the mood of the people"! In case you have not checked the result of the lok sabha and embly bypolls, the maharashtra local bodies poll, and Gujarat locl bodies polls...there is still time to check the Chandigarh poll results today!
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                                  1. P
                                    Prof. P.
                                    Dec 20, 2016 at 3:36 pm
                                    Tagging anti-national is not the point. Certain short-tempered persons are openly abusing the PM. But comparison with the scam-ridden UPA is making its large picture on majority mind. Murmurs of the politically oriented ones get buried under the majority feelings. Pak's PM is neck-deep in corruption charges. Maduro is a weak and not so por a leader. This is where the picture lies. The author seems prompting Indians to rise in protest! Better he/she uses his/her skill for constructive purposes.
                                    Reply
                                    1. S
                                      satchin
                                      Dec 20, 2016 at 9:05 pm
                                      Looks like the writer is related to the corrupt chidambaram and has lost a lot of black money
                                      Reply
                                      1. S
                                        Satish
                                        Dec 21, 2016 at 4:45 am
                                        Please no more editorial on DM we completely feed up with all prospect and narratives About the move.. Everyone is suffering from rich to poor,, you may use different euphemistic economic words to explain merits and demerit ultimately 90. Percent of potion suffering unable to access their own money is the ultimate reality.
                                        Reply
                                        1. A
                                          autonomous
                                          Dec 20, 2016 at 6:11 pm
                                          " Radika Iyengar " is sceptical,then as of your says patriotic means siding with corrupted peoples who are evading their tax and initiating a protest against gov move on demonestisation, every day someone is caught in every state regarding with illegal tax evasion moneys and fake currency and excellent huge control over maoist and seperatist in kashmir which have been fuelled by fake notes ,even this secret yet sudden implementation itself finding hard in finding the tax evaders then how come an early warning be usefull. Being liberal opinion is good but it will not be enough for current scenario so PM decision is right though it has hurdles.By the way trying to implement digitalization money transfer with aim of digital India is not an wrong idea.
                                          Reply
                                          1. R
                                            Raman
                                            Dec 20, 2016 at 3:42 pm
                                            The author erroneously compares India's much vaunted economy with that of decrepit stan and Venezuela. But why? The former's survival is dependent on China's mercy while the later has hyper-inflation economy? Ms. Radha Iyengar got it wrong. India cannot be compared to these two economy she is blurting out and her narrative is false.Why on Earth IE is printing this nonsense without rebutting her claims? I am from the middle cl economy and am fine with Mr. Modi's policies. Even a fraction of less corruption by any means is OK with me. Doing something is OK and doing nothing is worse as our politicians have done it in the past!!!!
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