note demonetisation

A month after demonetisation, the government seems to be confusing all cash for black money

All cash isn't black money and very little illegal wealth is in cash.

As he announced the cancellation of the legal tender status for Rs 500 and 1,000 notes on November 8, Prime Minister Modi made it clear that black money was the prime target of the move.

This move, soon christened demonetisation, is probably the most drastic economic decision ever taken by an Indian government. Yet, even for so large a move, aimed ostensibly at black money, the Modi government didn’t even care to define what exactly black money is. After one month of demonetisation, with the government changing the aims and rules for the exercise almost daily, it seems that the government has no idea what black money even means. This makes any move to abolish it rather pointless.

All cash isn’t black money

As demonetisation progresses, the aim of the exercise is increasingly shifting to pushing digital transactions. This when the prime minister didn not even mention this goal one in his original November 8 broadcast. In its official communications, the government is now making the mistake of conflating cash and black money.

Here are two ads put out by the Modi government.

The aim of digitising the incomes of cobblers and auto rickshaw drivers is described with the hashtag #IndiaDefeatsBlackMoney. With small merchants and craftsmen rarely making it to India’s legal tax bracket of Rs 2.5 lakhs a year, it is inexplicable how these people using cash can be termed “black money”.

And all black money isn’t in cash

This isn’t all. The inverse mistake has also been made. It seems the Modi government has assumed that a significant portion of illegal wealth is stored in the form of banknotes. This is an assumption simply not backed up by data. In fact, if the people who thought up the idea of demonetisation had read the White Paper on Black Money published by the Union Ministry of Finance in 2012, they would have known that black money is expressly not stored in cash. Cash as a proportion of assets sized as part of income tax raids carried out by the Union government amounted to between 4%-7% from the years 2006 to 2012.

Yet, rather than act against real estate or other forms of storing actual illegal wealth, the Modi government targeted its smallest source: cash.

Because the very foundation of the demonetisation drive was wrong, its efforts to combat black money have been rather ineffective. The Union government expected large amounts of it not to
make it to the banking system post demonetisation. The assumption was that black money hoarders would rather throw away their cash than risk being caught. On Friday, however, the Modi government admitted in the Supreme Court that nothing of the sort has happened and deposits had already exceeded estimates the government was working with.

Given that the initial drive against black money has now almost failed, there is a frantic search to attribute other aims to the demonetisation exercise to justify the massive disruption caused in the economy and the lives of ordinary Indians, the primary one being turning India into a cashless economy.

We welcome your comments at letters@scroll.in.
Sponsored Content BY 

Watch Ruchir's journey: A story that captures the impact of accessible technology

Accessible technology has the potential to change lives.

“Technology can be a great leveller”, affirms Ruchir Falodia, Social Media Manager, TATA CLiQ. Out of the many qualities that define Ruchir as a person, one that stands out is that he is an autodidact – a self-taught coder and lover of technology.

Ruchir’s story is one that humanises technology - it has always played the role of a supportive friend who would look beyond his visual impairment. A top ranker through school and college, Ruchir would scan course books and convert them to a format which could be read out to him (in the absence of e-books for school). He also developed a lot of his work ethos on the philosophy of Open Source software, having contributed to various open source projects. The access provided by Open Source, where users could take a source code, modify it and distribute their own versions of the program, attracted him because of the even footing it gave everyone.

That is why I like being in programming. Nobody cares if you are in a wheelchair. Whatever be your physical disability, you are equal with every other developer. If your code works, good. If it doesn’t, you’ll be told so.

— Ruchir.

Motivated by the objectivity that technology provided, Ruchir made it his career. Despite having earned degree in computer engineering and an MBA, friends and family feared his visual impairment would prove difficult to overcome in a work setting. But Ruchir, who doesn’t like quotas or the ‘special’ tag he is often labelled with, used technology to prove that differently abled persons can work on an equal footing.

As he delved deeper into the tech space, Ruchir realised that he sought to explore the human side of technology. A fan of Agatha Christie and other crime novels, he wanted to express himself through storytelling and steered his career towards branding and marketing – which he sees as another way to tell stories.

Ruchir, then, migrated to Mumbai for the next phase in his career. It was in the Maximum City that his belief in technology being the great leveller was reinforced. “The city’s infrastructure is a challenging one, Uber helped me navigate the city” says Ruchir. By using the VoiceOver features, Ruchir could call an Uber wherever he was and move around easily. He reached out to Uber to see if together they could spread the message of accessible technology. This partnership resulted in a video that captures the essence of Ruchir’s story: The World in Voices.

Play

It was important for Ruchir to get rid of the sympathetic lens through which others saw him. His story serves as a message of reassurance to other differently abled persons and abolishes some of the fears, doubts and prejudices present in families, friends, employers or colleagues.

To know more about Ruchir’s journey, see here.

This article was produced by the Scroll marketing team on behalf of Uber and not by the Scroll editorial team.