The worry on Sarwan Valmiki’s face was at odds with the serenity of the environment in Surpatipura village in the Bundelkhand region of Uttar Pradesh. Left with no money for the past week, this 70-year-old has been at the mercy of his neighbours, eating whatever he receives from them and often going to bed hungry.

His sons – Pushpendra, Jitendra and Subhash – live in Pune, where they work as daily wage labourers. They have always been punctual in sending their father money every month. “Around the middle of every month, I get some money from my sons,” said Valmiki. “It was for the first time in November that they did not send me anything. Still, I tried to manage for some time. But it did not last long, and for over a week now, I don’t have a single paisa left with me.”

In the intense jubilation surrounding Prime Minister Narendra Modi’s so-called surgical strike on black money, the stories of people like Valmiki struggle to be heard.

“Around 10 days back, Subhash called me on the phone and said they [the brothers] are not getting any work ever since Modi-ji imposed notebandi,” Valmiki said, his legs trembling as he tried to stand up.

Sarwan Valmiki has no money and is surviving on what he receives from neighbours. Photo: Dhirendra K Jha
Sarwan Valmiki has no money and is surviving on what he receives from neighbours. Photo: Dhirendra K Jha

It will take some time to arrive at a complete assessment of the economic disruption the government’s demonetisation decision of November 8 has caused. While a large number of daily-wage earners and their dependants have experienced a sudden collapse in their living standards as a result of sudden and widespread unemployment in the informal sector, a small minority of them – and their ranks may swell if the situation does not improve quickly – is quietly being pushed to the verge of starvation.

Urban misery

In villages such as Surpatipura, deep social bonds may result in the community extending some kind of helping hand to vulnerable members, at least for some time. But in urban areas, where no such practical bonds exist, the situation is even more alarming.

For a snapshot of how urban daily-wagers are dealing with the impact of demonetisation-induced joblessness, visit Shanti Nagar, a residential hub of labourers in Firozabad, an industrial town in Uttar Pradesh 200 km from New Delhi and known for its glass industry, particularly its famed glass bangles.

“For a few days after bad times hit us, we survived on our savings,” said Raeesa Begum, a bangle worker and mother of eight. “By the end of November, we had consumed almost all of our savings. So we sold our bhathhi [household gas furnace used for soldering the joints of bangles] for Rs 500. Now, we have started eating only one full meal a day.”

Apart from the bhathhi, Raeesa Begum has sold most of her household utensils, and on December 5, when this reporter last met her, she was looking for a buyer for the family’s sole bicycle.

“There are over 100 families in Shanti Nagar and most of them are experiencing the same crisis,” said Bakhtiyar Ahmed, a social activist and resident. “Almost all of them have Jan Dhan [bank] accounts, but more than 80% do not have ration cards,” he added.

For the past year, Ahmed has been trying to get the local administration to get ration cards for the residents of Shanti Nagar. “The situation would not have been this bad if these people had access to subsidised foodgrains,” he said.

Their daily existence at risk, a large number of residents have started taking loans from moneylenders, who charge exorbitant rates, generally 10% a month or 120% per annum.

“If this practice continues for a few months, it would become impossible for these people to come out of the debt trap they are slowly getting into,” said Shammi, a senior resident of the locality who has desisted from taking a loan so far. But it is difficult to say how long he can survive without falling prey to the moneylenders.

Firozabad has over 400,000 workers engaged in the glass and bangle industry. Since the owners of glass factories outsource the work, nearly three-fourths of this workforce is unorganised, comprising home-based workers who take daily payments in cash. Entire families, including women and children, are engaged in such work, which involves colouring, shaping and decorating the glass bangles, and soldering their joints.

“Only those workers who are directly employed by factories are not facing this crisis at the moment because they get monthly salaries,” said Mahesh Chandra Sankhwar, a trade union leader associated with the All India Trade Union Congress. “They account for a little less than one-fourth of the total population of workers in Firozabad. But even they are bound to be affected in some way because nearly 70% of factories have stopped work due to the cash crunch after demonetisation.”