One Month Of Demonetisation Has Shown It Was A Bad Move

Posted by Avishek Das
December 12, 2016

Well, we have completed one month of demonetisation. In my eyes, the picture is uncertain when one looks at it from the parameters of eradication of corruption, holding of black money and betterment of Indians. The dream of a clean India, which our honourable Prime Minister has shown us contradicts with the real facts of demonetisation. With little knowledge of economics and regular follow up of the newspaper, the incidents are throwing several questions around me.

According to the Reserve Bank of India data, there was money worth 14 lakh crores in the notes of ₹500 and ₹1000 till November 8, 2016. According to a report in The Hindu in the first week of December, deposits made in the form of ₹500 and ₹1000 notes may have neared ₹11 lakh crores. This means that only a negligible amount is there in the market or in the hands of the people and majority of it has been deposited into the banks. Then, what is the use of this demonetisation?

But one thing is clear from this demonetisation. People have become heartless. I stay in West Bengal. A few days back, a government employee was standing in the queue of an ATM to withdraw his deposit and that was also fixed by the government at ₹2500. After a certain time he fell down and people around him were busy in withdrawing money. According to a report in The Hindu, the people present there said that the security personnel contacted the doctor. After 30-40 minutes, he was taken to the hospital where he was declared brought dead. Is this the picture our honourable PM is expecting? I guess not. So, why has the unplanned approach allegedly taken 90 lives? Who is responsible for this unwanted situation? There are several questions, but the answers are nowhere.

Let’s come to digital economy, which is another step that our honourable PM also highlighted. Personally, I used to buy items using cards and was very much aware of the internet banking system. The positive side of the digital transaction is that it makes it easy for the government to keep records. But are most of the people in India accustomed to this system? There is a bit of doubt over there. Around 70% of the population lives in the rural area. Banks are a rarity there. I’d just like to share one example. My father has a business related to the fisheries and the labourers working with him are illiterate. It’s difficult for them to use ATM or Paytm. It becomes difficult for many of them to understand digitalization as they don’t get the facility of the banks in rural areas. So, providing the basic facilities and educating the rural populace was much needed before promoting digitalization. One more question is valid. With the current infrastructure, is the concept of digitalization valid? Due to this currency crisis in the market, my father has to stop the business and needs to wait till there is an adequate supply of the currency. For the time being, what will happen to those people who are working under my father? In the unorganised sector in India, a huge chunk of the workforce is employed. Just think of what is happening to those who have become jobless. Has this approach of the honourable PM  given certain benefits or has it made people’s life painful?

The growth rate was estimated to be  around 7.6% and less than a week back, the RBI reduced the economy’s expansion forecast to 7.1%. Why has this situation arised? The objective behind demonetisation is to eradicate corruption and black money from the system. Another question arises from this point. Why is there a crisis of currency in the market? Can we assume that the RBI does not have the infrastructure required for printing the adequate number of notes, or they have an inefficient team which cannot estimate the mechanism of demand and supply?

A declaration was made which allows households where marriages are to take place to withdraw upto ₹2.5 lakhs by producing relevant proof. One week ago, when I visited a bank for withdrawing money. I noticed a woman with an invitation card of the marriage ceremony was persuading the officer of the bank to process her withdrawal as soon as possible due to her daughter’s marriage. At that time there was a shortfall of funds in the bank and the officer asked her to come the next day. From this situation, another question arises. Who is responsible for this situation? Will the government take the responsibility of this woman to conduct her daughter’s marriage? From the newspaper we can observe that marriages of VVIPs are going smoothly and crores are being invested. I wish all the marriage ceremonies are held smoothly. Why is there discrimination? We all are independent and living in a democratic country. Is fixing the amount of withdrawal on marriage expenses justified? This situation reminds me of the subject of history. It reminds me of the concept of Divide and Rule system by the British administration in India in the pre independence era.

When will Indians be getting the real flavour of independence? I know we all are independent due to the Constitution, but we are still enclosed in a system that fixes our lifestyle. Shame on such a democracy!


Image source: Hindustan Times/Getty Images