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    Demonetization: A Pill Gone Wrong


    Demonetization: A Pill Gone Wrong

    Satwant Singh Rissam

    31st December 2016 is coming and earlier around this date we all use to be so happy thinking about the coming New Year. But this year significance of this date has definitely shadowed the happiness of many. This year 31st December is also a deadline for depositing the scrapped currency notes of Rs. 500 and Rs.1000 into bank accounts. All of it started on 8th November 2016, when the Indian Prime Minister Narendra Modi continuing with his promises to fight corruption, abruptly scrapped the currency notes of Rs 500 and Rs.1000 denomination with some conditions and deadlines announced along with it. But by the side of this announcement came replacement of these notes with new Rs.500 note and Rs. 2000 note. The thrust was to go for cashless transactions from very next day after withdrawal of 86% of country's currency. The main argument behind imposing this decision was to flush out black money, corruption, counterfeit notes and terrorism funding in India.

    Meanwhile like rest of the country, within minutes too had impact of this announcement. People started running out of their houses to spend these scrapped notes in one way or other. A sense of urgency to get rid of these notes was witnessed in many Jammuites. It was the quantity of notes which made every family in Jammu to decide where they should spend it.  Some people rushed to stand in lines at petrol pumps while others went to nearest grocery store. Most important ‘appeared-segment' that night were people who went rushing towards jewellery shops of Jammu. Incidentally, some of those panicked customers are at present finding themselves in CCTV recordings of the jewellery shops. These recordings are now evidence against them. On the night of 8th November, Jammu markets immediately swelled as there were countless confused buyers out on roads.  Many shops in Jammu that night even remained open till 1 a.m. Things didn't end up soon and many after effects of this announcement were visible in Jammu. One of the events which came into public domain was when some vehicle was found carrying scrapped notes in Jammu city. Another thing that has amused Jammuites is how nothing has happened in after this big announcement. People in Kashmir protest for any small incident like ration shortage but they didn't protest over currency note shortage.

    Demonetization drive was just a beginning, as since then we are seeing some traits of undeclared-financial emergency across India. A political turbulence has come in country as whole opposition is on a tight rope with this policy implementation. They since then have been accusing PM Modi's idea of cashless unrealistic. But this accusation looks factual in a country where several crores of people in rural India don't have any bank account even till today. We cannot overlook the role of internet also as far as implementation of cashless economy is concerned.  Just think of rural India where we have negligible internet presence. On the other hand, if in J&K any small anti- social incident happens then first step taken by administration is to shut internet services. How can with such prevalent internet services India can go for cashless economy? Several problems were also aggravated by everyday changing deadlines and flip flops of the central government. Post demonetization it appears that the working of banks and ATM's have totally altered. One aspect of bank operations which impacted the policy of demonetization is ‘Jan-Dhan accounts'. These accounts were opened by all banks with an objective set by government to help poor people in country. Strangely time changed and these accounts came to rescue of rich by helping them to launder their cash into such accounts. One more case is of Axis Bank where its employee's have been found involved in trading with old scrapped notes against new notes. While on the other hand, ATM's are no more 24×7 working machine as ATM's dry up within few hours signifying the intensity of problem. Moreover, ATM's are now becoming death points as in last one month we saw many deaths of people while standing in ATM lines across country. It is one of the heartbreaking moments as people are getting killed for their own money. It appears that all such situations have emerged all because of non-availability of cash in country.

    Demonetization is no doubt a very reforming and politically bold step for the country taken by the PM Modi. But I believe demonetization for now has not been handled properly and this pill to cure country has gone wrong. This whole drive has backfired and tarnished the image of Prime Minister. The present Prime Minister was considered a -friendly politician because of his work and growth achieved in Gujarat. But here its contrary as demonetization has clearly affected the businessman of this country. Let's not forget its impact on farmers who are part of 98% people who buy and sell mostly on cash in India. Either it is a disaster or a miscalculation, by the group of people in government who conceived this demonetization scheme. In addition to it, the fight against corruption touched new low, as a situation in country has emerged whereby people are buying new notes against old notes by paying heavy commission. Hence, it has given rise to new corrupt practices which hinders the basic idea behind demonetization. Another fact that demonetization will impact the terrorism funding too got affected after a Kashmiri militant, who was killed in encounter, was found carrying new Rs. 2000 note within few days after demonetization drive started. The possibility of people getting immediate relief is not near but things have started improving very slowly after 6 weeks. Inspite of sufferings of small scale industries, we should still support the government argument that demonetization drive will bring good days for Indian economy. Let's support this reform but present pain shouldn't be ignored against future promises.

    The Northlines is an independent source on the Web for news, facts and figures relating to Jammu, Kashmir and Ladakh and its neighbourhood.

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