The first anniversary of demonetisation last week was marked by absurd claims from both cheerleaders and challengers. Social media had fun mocking both sides. The Finance Minister’s claim that it was an ‘ethical, moral’ step came in for jeers, as did former prime minister Manmohan Singh’s assertion (repeated ad nauseum) that what happened on November 8 last year was ‘organised loot and legalised plunder.’ A WhatsApp cartoon of the good doctor shutting his mouth, ears and eyes to the 2G, coal and CWG scams and screaming ‘loot, loot, loot’ over demonetisation went viral.
Have no fear, dear readers, I have no intention of discussing ever again in this column the cancellation of 86 per cent of our currency or its consequences. The subject bores me now, as it does most people I meet on my travels in our ancient land. We must hope that after this current round of elections the Prime Minister will stop defending what he did, because every time he does, he adds menacingly that he will not spare corrupt politicians and hoarders of black money. What he appears not to have noticed is that officials entrusted with this hunt for black money are famous for their own love of it. This is something that remains a deeply guarded secret usually, but every now and then, the tax department raids one of its own and out of secret lockers and ‘benami’ apartments tumble riches beyond the dreams of most rich Indians.
The Prime Minister and his colleagues in the government and in the BJP have spent much time exulting over the World Bank moving India up 30 notches in its annual report on the ease of doing business, but everyone concedes that new jobs are not being created. For this to happen, private investors need to start investing their money in new businesses, and it should not matter whether their money is black or white. As Deng Xiaoping famously said, ‘It doesn’t matter if a cat is black or white, as long as it catches mice’.
Now let me move on to a subject that I have talked of often in this column and will continue to do so. I do this to remind our political leaders that some of us know where black money really exists in abundance. It oils the wheels of India’s election machinery. Having covered many, many elections in long years of covering politics and government, believe me when I tell you that it is only at election time that us mere mortals catch a glimpse of real ‘black’ money. Not everybody does, but we who have the dubious privilege of watching elections from a ringside seat certainly do.
Here is what happens. When political parties finish choosing their candidates, the chosen few line up at party offices to collect whatever little the party bosses can give them for campaigning. This is always in cash because political parties always collect most of their funds in cash from businessmen, big and small, who always pay in cash, not digitally or by cheque. In recent years, some businessmen who like to boast about being ‘moral and ethical’ have made donations by cheque, but this remains a rare occurrence.
Usually what the candidates get from the party is a fraction of what they need, so then they start urging their friends and supporters to help them in any way they can. These contributions also always come in bundles of cash, which get stashed away in secret cupboards that only the candidate has access to. I have personally seen these stashes in the homes of the most honest politicians I know. When I say ‘honest’, I mean those that count among that small handful of our political class that have genuinely come into politics with the idea of public service.
Sadly these days most Indian politicians enter public life with the idea of becoming rich quickly without bothering to get a regular job or risking investment in some entrepreneurial venture. Politics is the easiest and least risky way of making money in India. The only risk is that of losing an election, and experienced politicians have learned to read the wind, so when they sense defeat, they stop wasting money on campaigning and save what they have collected for some other political purpose. Corrupt politicians spend what they save on cars, jewels and real-estate, and honest ones save it for a future campaign.
This is the real story of ‘black’ money in India, and it is obvious that this story is not going to change much in the near future. So dear Prime Minister, if you want to create the 12 million jobs young Indians need every year, then it could be time to pay attention to the wise advice of Uncle Deng. It doesn’t matter if a cat is black or white, as long as it catches mice.