Demonetisation: Good intent, Bad management

It has been almost 3 months since Prime Minister Narendra Modi announced to demonetise higher currency denomination which contributes to 86% of Indian currency to cease to legal tender. It was a harsh move for Indian economy where 54% people without bank accounts. We have been thoroughly illustrated hard ship of people faced due to this decision. It is now a month after the asked time of 50 days, people are still facing cash curb. Does this mean demonetising is a complete failure or merely success.

Shifting goalposts

We all know Demonetisation was intended to bring back the black money help Indian economy function better. In this event, efforts to combat black money have been so far ineffective. Govt. assumed that a significant amount of black money was in bank notes but practically by December 30 entire stock has been deposited (including black money, if any). Given that the initial goal of this move against black money proved to be a failure, the goalpost has been changed from curbing black money to cashless economy to digital transactions. All this to justify move which had caused much disruption.

At social level Demonetisation presented a great moral project to clean up national economy. It has been portrayed pro-poor move to redistribute justice. Many people believe in trying to curb black money Govt. is acting against rich hoarding illicit cash. The idea that rich are suffering was undoubting appealing to poor. But this move proved to be a good intent and bad management policy.

Suffering with no Grievances

There are 3 major reasons to explain the relative no protest against this move.

  1. The general climate of fear and the govt. intolerance of dissent which deters people from expressing opposition to the move.
  2. Indian obsession with black money. Black money is the single hottest debate for decades in India with successive anti-corruption movements.
  3. Government has repeatedly offered trope of nationalism so that anyone opposing demonetisation is denounced to be corrupt and anti-national. Repeated quoting of this move as cleaning up of nation and comparing it to pro-poor policy.

Lack of any big protest is by no means as an expression of public support of the decision. Government’s claim that people are overwhelmingly supporting this decision is privy to sentiment given that today government is a master of one-way communication. There is no need to accept downside of this decision but social obligation of government to address public grievances is must.

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