India is a confused nation. Suspended precariously between the
developed west and the “under-developed” global south, the country swings
drastically and sometimes with great peril to itself.
It wants to be modern, after all modernity is the development
paradigm that all the ‘other’ countries must have. The west, India’s
aspirational model, has over the years through colonisation and
post-colonisation drilled into the psyche of the global south that modernity is
the way to go. Modernity ignores the traditional society after all being
traditional is the antithesis of modernity. No doubt, the biggest casualty of
modernity is the demise of the traditional society - a society that is not necessarily
bad but just different.
Narendra Modi secured the mandate to be the Prime Minister of
India two years ago holding tightly on to the banner of development. During his
election campaign he promised to bring back black money parked in offshore
accounts, boasting that it would add fifteen lakhs rupees to every household. A
promise he could not keep, a promise that the Congress led opposition and his
critics used often to mock him. So Modi came up with a Plan B to crackdown on
black money.
On November 8, 2016, at 20:45, Modi announced on national
television that the 500 (£6) and 1000 rupee (£12) denominated banknotes would no
longer be valid from midnight and new 2000 and 500 rupee banknote will shortly
be introduced in circulation, to the 1 billion population of the largest
democracy in the world. The reaction was nothing but shocking.
The literate, technological savvy and socially connected elite
and upper middle class took to their opinion platforms and most hailed it as a
‘masterstroke’, ‘surgical strike against black money’ and applauded Modi for
being a “great statesman”. The lower middle class and the poor that account for
over 50% of the population (World Banks report 2016) remained in shock not
really understanding what it meant. Some still are.
Try explaining to the labourer why the 500 rupees she got for
her week’s work at the site will no longer get her any rice and dal (lentils) at
the local kirana (provision) shop; or to the farmer whose 1000 rupee banknotes
will no longer be able to buy him any seeds; or to the maid who every month,
puts aside a 500 rupee banknote in the seams of her old saree so that her
abusive husband cannot grab all her earnings for his alcohol addiction, that
her banknotes will no longer fund her daughter’s college next year. Or explain
to the retired old man why withdrawing his savings from the bank for his
daughter’s wedding would be an impossible task and a cause of his death; or the
helpless mother who could no longer feed her children with the money she had
and so hangs herself unable to bear to see their hungry faces.
Finance minister Arun Jaitley finds it hard to believe that the
poor in India would even have a 1000 rupee banknote. They do and its call their
life’s earning. For many it takes months and perhaps years to save that. I
remember how my maid would every six-eight months bring in a few hundred bucks
she had saved and take a bigger denomination – a 500 or a 1000. This she
believed would go into her saving box for a life’s mission. Life’s missions for
the poor and the lower income groups in India are simple – a child’s education
or marriage, a brick & mortar home, a hospital treatment long due or just
enough for essentials on a rainy day.
In March 2016, the Reserve Bank of India report estimated that
the 500 & 1000 rupee banknotes amounted to 86% of the total currency in
circulation. Withdrawing them and introducing a higher denomination banknote would
no doubt be a herculean task with catastrophic consequences. But the government
announced demonitisation with little consideration to either the cash based
economy or the infrastructure. India’s banking infrastructure failed miserably
when ATMs were unable to dispense new notes and then not having enough currency
for withdrawals. Banks required documentation and set an upper limit of
withdrawals to 4000 rupees (£54) a day then reduced to 2000 rupees (£24)
indicating that huge disparity in the demand and supply. This threw the economy
in complete chaos and it will last for weeks to come.
Also many don’t hold bank accounts forget plastic money. They
save through community saving programmes that are primarily cash based or bury
the money in a hole in their homes (in some cases quite literally). But
development of the poor is indicated by having a bank account, once again
feeding into the psyche of capitalism. Perhaps many of them chose not to have a bank account but
just because we want them to be modern on our terms we will now arm twist them
into opening one? It’s not a question of evaluating the merits of bank accounts
but rather the question of choice. Just like the long queues at banks or ATMs, the
twitterati compares to standing for tickets to concert or cricket matches. It’s
not the same, simply because in the latter you have a choice not to do it.
However, in this demonetisation drive, this very choice is taken away.
This is the India we often forget exists in our desire for
modernity. India is largely a traditional society, a large population that earns
an honest bread after a hard day’s labour. And it is this section of society
that has not just being “inconvenienced” but victimised unjustifiably in this
quest to score a political brownie point.
Small businesses are suffering and the death toll is rising by
the day. Look at just some of those who lost their lives in this meaningless
desire by the government to improve its political image. These are not some
global businessmen that siphon off their profits to offshore accounts or child
traffickers that made their fortune by trading in vulnerable kids. These are
not even politicians who have amassed their fortune through questionable means
or the underworld who made a bounty through illegal operations. These are
honest, hard-working individuals who could not bear the shock of realising
their life’s saving were now worthless tender or who could not get access to
their white hard earned money in time to pay for crucial events.
It’s not that the political elite do not realise how badly their
plans backfired, they do. Modi changed his tune from the hard taskmaster on
black money to this brave soldier who has risked his life and limb to take on
the bad guys singlehandedly for the greater good of the country. Are we to feel
sympathy for the man who now never has to stand in a bank queue to exchange his
currency to put food on his table yet largely ignore the plight of the millions
that do?
It’s time the politicians acknowledge who the
real martyrs (though involuntary and unsuspecting) have been in this currency
war. It’s time to admit the mistake and show those who lost their lives some
respect. And perhaps give their families some quick monetary compensation, in
new currency notes.
(First published in The Beaver, LSE)
