By Adil AH:
India is one of the fastest growing economies in the world, but the speed with which we were growing might get affected due to the PM’s announcement on November 8 of demonetising ₹500 and ₹1000 bank notes.
Like every other issue, people from urban areas are on the frontline of these debates, and we haven’t remotely heard what people living in the rural areas have to say about demonetisation. The absence of opinion stays despite the fact that 70% of the Indian population lives in rural areas and is dependent on agriculture as a source of livelihood.
Is it because we haven’t heard from those living in the rural areas that we think that demonetisation doesn’t or won’t affect them?
Even though the majority of the Indian population lives in rural areas, the economy is dominated and influenced more by those living in towns and cities. One of the main characteristics of the rural-urban divide is glaring income disparity. The 2011 Census points out that more than half of all rural households earn less than ₹5000 every month. Those living in the urban areas have a major share of the total money circulating in the economy and, in all likelihood, the maximum amount of black money would also be in possession of those living in urban areas.
Demonetisation will have short term effects on urban India. People living in urban areas have access to good education and are more likely to be aware of changing monetary regulations and policies. They also use modern and advanced banking facilities and will be able to, or already have exchanged their old notes by following bank procedures and chances are less that they would lose any of their hard earned money due to demonetisation.
It won’t be an easy task to exchange ₹500 and ₹1000 notes in the rural areas because of various factors. Lack of education and poor information channels are two problems that’ll act as a major hindrances for those living in rural India.
They might not have been informed of all the rules and regulations that were implemented after the demonetisation announcement. A lot of people don’t have bank accounts; adequate banking facilities or assistance might not be available. Many could be daily wage labourers or small farmers and might not use banks for transactions, or a lot of their savings are in cash ( in ₹500 and ₹1000 notes).
The government must take necessary steps to help the poor in exchanging their old notes and ensure that they are being made aware of all changes to avoid harming them any further.