Politics Now

Big Bucks Banned

While the stern move is definitely welcome, the dictatorial style of the government is not… There is, at the end of the day, no definite assurance that counterfeit currency would not be produced any further.

The Modi government is good at bowling googlies when one would least expect them: in an unprecedented move, the Prime Minister has announced that the Indian currency notes of denomination worth five hundred and a thousand rupees would cease to be legal tenders from midnight today.

The bold move has been taken in order to curb corruption and reduce the number of transactions involving black money. According to official statistics, 250 out of every 10 lakh notes are identified as counterfeit currency. However, despite the government officials taking yet another opportunity to brag about their radical step, the common man looks to be left in an uncomfortable spot.

The banks remain closed tomorrow, and that has added to the general worry. The order to declare the denominations invalid from midnight of 9th November has come across as the biggest shock. That simplifies the equation to something that is sure to disturb our thoughts: for a minimum of two days, all your five hundred and thousand rupees notes stand worthless: until they are exchanged, that is. The exceptions, where the aforementioned notes would still be valid till the eleventh of November, are airports, railway stations, crematoriums, chemists, bus stands, airline counters, and a few more of such public facilities. Think of all the high-value transactions that falls outside of the domain of the exemption purview that the government has drawn: all such dealings need to be now made in hundred rupee notes within these days. The other concern is the astronomical lines that would plague the bank counters the day they reopen. To make matters worse, ATMs would not function on the ninth and tenth of this month.

The move is sound on paper. However, on a second thought, this would be causing unrivaled tribulation to the public at large, in an unwarranted manner. Things could have been much smoother and the public response more affirmative had the time for the notes being disqualified been extended even by a day. Ironically, the announcement was made at 8 PM to phase out the notes from 12:00 AM. That is overriding the public with your whims. I agree all of this would lead to long-term benefits, but there are more efficient ways to accrue them instead of harassing the public in such a manner. Some have rightly pointed out about the minnows whom we have left out of the equation altogether: the petty vendors, the ones who sell at the bazaars, how would they manage to get so many hundred rupee notes until all those glittery grand notes are exchanged? How would the common man manage? How would the teenager who orders a good sum worth of goods online under Cash on Delivery (COD) pay that amount over hundred rupee notes? That is a point to ponder on. The bank remains closed on the following day. What happens to the people who are desperate to exchange their money at this point? They are left in the lurch. While the stern move is definitely welcome, the dictatorial style of the government is not.

In a nutshell, the pertinent questions that still remain are:

  1. The Government should accept absolute responsibility for the trouble faced by a billion people throughout the nation, and must make last mile arrangements to ensure that no one is denied the right to exchange such currency despite geographical limitations, or otherwise,
  2. I still do not understand the use of the denomination worth Rupees Two Thousand. The RBI could have introduced a new format for the thousand rupee note in a similar way, akin to its counterpart being sacked,
  3. There is, at the end of the day, no definite assurance that counterfeit currency would not be produced further. While it may take some time to duplicate the new patterns, deceiving people is very easy: and cheats are good at this business. What happens then?
  4. Those who stash away their money in Swiss accounts are not imbecile to keep their wealth in liquid cash. They keep their wealth distributed over movable and immovable assets. What impact would the move have over these people?

If this works out, it would indeed be nothing short of a historic move worthy of being recorded in the record books. If not, a failure of monumental scale for the NDA government that is already receiving brickbats from the Opposition for such an insensitive and hasty move.

EDIT: As of now, I can independently confirm that the rumors relating to the notes having GPS tracking abilities are baseless and fake. No such measure would be incorporated into the new notes.

UPDATE: Fake currency notes have been detected within days of the release of the new notes.