Has Narendra Modi’s obsession with ‘black money’ caused him to commit political suicide? Or is there method in what he has done? These questions have been asked over and over again by political commentators and economists all week. The group I think of as the usual suspects have jubilantly reported that Modi has made the biggest political mistake of his entire career. But they have written Modi’s political obituary many times before, including when he was just a chief minister.
After he became Prime Minister, this group wrote him off when Mohammad Akhlaq was killed, and writers, poets and intellectuals launched the ‘award wapsi’ movement. When this celebrated movement died within hours of the Bihar election, other reasons to write Modi’s obituary were found. Beef vigilantism, the tragic suicide of Rohith Vemula and the sedition charges against students of JNU being high moments of the campaign. Personally I have learned to dismiss commentary from these usual suspects as dishonest. This group is made up of ‘secular thinkers’ who in allegiance to their credo never once attacked the Sonia-Manmohan government for any of its policies. And again on account of said credo, have been virulent in their attacks on Modi from the day he became prime minister.
This time it is another group that has been most vocal, and since it is made up of almost every major opposition leader, its view must be taken seriously. The consensus here is that not only has the Prime Minister behaved like a power-crazed dictator (Hitler’s name has been much used), but that he has revealed himself for the first time to be a hopeless administrator. Dr Manmohan Singh, by comparison with the rest, spoke in sober and measured tones in the Rajya Sabha, and even he accused the Prime Minister of a ‘monumental management failure’.
Within hours, the Prime Minister responded. He said that the only people charging him with not having been prepared for the consequences of his currency replacement were those who had ‘black money’. This is probably true. But it could be time for Modi to admit that neither he nor his officials were prepared for the consequences of what he did. Had there been better preparation, ordinary Indians who work in different areas of that obscure infrastructure that holds up the vast informal sector of the Indian economy, would not have suffered. These are ordinary people who work in a mostly menial capacity, for wages that are paid to them daily. If the Prime Minister had not withdrawn the Rs 500 notes, they may not have suffered for a single day.
If even now he is prepared to admit that a mistake was made and allows the Rs 500 notes to remain in circulation till they can be replaced, he could end up increasing his popularity hugely. There is no point in denying that even those who currently suffer considerable hardship are very supportive of what the Prime Minister did. Last week I made it a point to wander about rural and urban bazaars talking to the ‘common man’, and was personally astounded to meet not one common person who did not support the fight against black money. They explained that it was because they are sick of seeing political leaders and high officials living like princes off money that they have not earned. They are sick of paying daily for services that should be free. They know the humiliation of walking into a police station to register a complaint and finding it is not possible without a bribe, and they know the anger they feel when they are forced to pay officials for services that are their right.
In their limited understanding of why this happens they link all corruption to black money, and this is why the Prime Minister’s move is popular. This popularity could wane fast if new currency is not made fully available in weeks. At a rally in Punjab last week Modi urged farmers to use their cellphones for digital payments and banking. This indicates that he is not as au courant with India’s ground realities as he should be.
So why did he do what he did? It is clear that he was primarily motivated by his personal obsession with ‘black money’, but there could be a method that underpins this obsession. Public sector banks that were running on empty are now flush with funds that can soon hopefully be used for building the roads, ports and cities that Modi dreams of. There could also be more money to lend the private sector that has been ominously stagnant. It really is time for a slew of other reforms, both administrative and economic, and unless the Prime Minister gets on with them with as much speed as he rid us of 86 per cent of our currency, he could find himself in big trouble.