It really is a matter of a big surprise that various leaders of the BJP are seen appearing on national television channels since last five or six days to defend BJP government’s decision of demonetisation which was announced a year ago. The government itself accepted that the GDP saw a 2 per cent drop as a result of this decision, the opposition claims the drop is actually over 3.5 per cent and that demonetisation delivered a death blow to the economy especially the rural sector where no digital payment mode was established before its implementation.
The manner in which the BJP has decided to go on the aggressive on the first anniversary of the decision about demonetisation itself shows that the party fears some major political fallout. India’s economy has always been cash-driven and the current indications are that it will continue to be cash-driven in the future too. The country depends on agriculture. This sector is driven only and only by cash. Since this sector attracts no income tax, there is no question of it being forced to move towards digital transactions. If 60 per cent of the economy is agro-driven and it has no income tax, how can the rest of the 40 per cent be encouraged to not use cash?
The BJP wants to celebrate 8th November as an anti-black money day. But the overall indications coming from nationwide reports suggest that no black money hoarders have faced any action till now, a year after they were reportedly ‘given a shock’ by the Prime Minister’s decision to cancel Rs 500 and Rs 1,000 notes. No action is seen happening against any of the rich black money hoarders and politically speaking it’s a big headache for the BJP now because the only people who have suffered in the past year are clearly the poor and the weak!
Legally speaking, a decision like demonetisation can be taken only if it is initiated by the Reserve Bank of India, but now Congress leaders claim that in the first week of November 2016 there was no consultation or initiation from the Reserve Bank on executing demonetisation in India so it was clearly a political decision. Now it has become very obvious that most of rural India and much of urban India, including the corporate sector and manufacturing sector have been hit terribly by demonetisation and till now no benefits have been seen in any manner.
People by and large have moved back to using cash in the past few months as a series of news stories done by Sakal Times in and around Pune city reflected in the last few days, so the big target about digitisation of economy is clearly not met and since most (perhaps 95 per cent) of the black money was in any case parked abroad or in gold and real estate etc, no impact has been seen in terms of ‘catching the tax evaders.’
Demonetisation has worked towards delivering a blow not just to farm sector and industry but also to the unorganised sector where small salaries of lakhs of people all over India are paid in cash. Since employers ran out of cash they sacked people and thus lakhs of jobs were lost.
There is hardly any benefit of demonetisation that the government can point out at this stage and as a result benefits of catching black money hoarders through the trail of money that they have deposited in banks is being sighted. Hopefully at least some such culprits should be caught in the coming months and years so that the pain that the ordinary Indians went through for many months is justified at some stage.
- ROHIT CHANDAVARKAR
