On 13 November, five days after demonetisation, Prime Minister Narendra Modi, choked with emotion, made a speech in Goa, the first after his government withdrew Rs 500 and Rs 1000 from circulation. “I have asked the country for just 50 days. If after 30 December, there are shortcomings in my work or there are mistakes or a bad intention found in my work, I will be prepared for the punishment that the country decides for me,” Modi said. In counteroffensive to blunt the opposition criticism against demonetisation, Prime Minister made his commitment to the action loud and clear. Did you think Modi will just come and go like other political parties …I am not here for the qursi (high office). I left my home, family, everything for the country. I know what kind of powers I have taken on. I am aware they will not let me live. Let them do what they want … Brothers and sisters give me 50 days.
On 30 December the time the Prime Minister sought from citizens of India ends. And many things have changed since then which could probably have a far-reaching effect on Indian polity.
The first change on the demonetisation narrative was made by the government itself. The move. which was pitched as a battle against corruption, black money and terror funding was in a later stage relegated to the background. Prime Minister Modi, his cabinet and party colleagues immediately changed the gear and spoke volumes about the virtues of going cashless. When 86 percent of the currency was withdrawn from the economy, the government and the supporters of the move were saying that only white money will come back to the banking system.
The amount of money that won't come back would naturally be counted as black money. But when the Finance Minister Arun Jaitley held a press conference on Thursday, he has not delved into the details regarding the money coming back to the system. The authorities now say that though the huge chunk of the of demonetised currencies is back into the system, it needs to be ascertained how much of it is white and black. In fact the authorities are now admitting that the purported surgical strike against the black money has not been successful in the first instance. Arun Jaitley, in the press conference, attributed demonetisation to increased growth in tax collection without elaborating on the impact on Gross Domestic Product(GDP).
Reports from rural India suggested that worst-affected groups of the demonetisation have been the lower income groups in rural and urban areas. The reports of farmers dumping their produce in highways due to the fall in market value have hogged the headlines of dailies recently. And experts have commented that the cash crunch experienced by the farmers during the rabi season is going to have negative impact on the economy and they worry it will exacerbate the rural distress . Across the country the sowing was affected due to lack of liquid money in the hands of farmers. In Punjab wheat sowing was down by 5 percent because of the liquidity crisis according to estimates prepared by the Agriculture department of the state government. Problems of the farmers got compounded because of the restrictions imposed by the RBI on Cooperative banks across the country.
Though the government continue with their high-decibel campaign for demonetisation, the common man’s life without liquid money continues unabated. The fact that RBI has changed or modified its criterion for withdrawal of money more than 60 times that speaks about the confusion the authorities encounter in dealing with issues developed after demonetisation. The RBI has recently revealed that it recommended demonetisation just hours before Modi’s announcement. And the central bank refused to divulge the reasons for resorting for demonetisation.
Despite people’s anger and the confusion within the administration made public by the almost daily change in regulations, did the opposition parties able to capitalise on that. The modicum of unity shown by the opposition parties was thrown into pieces when Congress Vice President Rahul Gandhi met Prime Minister Modi while Parliament was in session. Bihar chief minister Nitish Kumar, whom many considered as the person who may be the opposition face in 2019 election, supporting the demonetisation, also showed the division within the opposition.
What the demonetisation has proved in the last fifty days is that despite the hardships faced by the people and severe distress it caused, the government action has not resulted in any political consolidation against the move. But this has been the case when the country was initiated to liberalisation. Though many parties opposed it, they generally subscribed the globalisation policy. Though the people rejected the liberalisation policy in the very next election and subsequent elections( the only exception was 1st UPA government. It was that government which introduced some social security measures which are anathema to liberalisation logic).
The Delhi, and Bihar election results can also be viewed in this way. But people’s political expressions with regard to liberalisation policy have found a quiet burial by a sheer compromise made by Indian political parties. Is demonetisation, which of course is not a war against corruption or black money as the government try to place it, going to be another instance of mainstream political parties fail people by their opportunistic politics?