Political and economic benefits and the fallout of demonetization is being discussed everywhere—so as its adverse impact of cash crisis on small and medium businesses, labourers, farmers and so on. Loss of jobs in industrial and other sectors—which was already facing recessionary trends—has hit the workers as many sectors are taking steps to go slim, downsizing their workforce.
There are many who compares the situation akin to a notorious emergency during Indira Gandhi regime and a newly crafted financial emergency wherein people are forced to struggle to withdraw their own hard earned money from banks. Yet, there are many among the poor, lower middle class and others who hail Prime Minister Narendra Modi for his decision to demonetize currency notes of Rs 500 and Rs 1000 denomination.
The quintessential Indian hypocrite is happy in thinking that at least the person, much well of than him, has been robbed of the money which he had amassed. A landless labourer is thinking demonetization has hit a big farmer, a class four employee thinks that the officer might have lost money, an officer is thinking that a top bureaucrat had lost money and an ordinary person thinks that his well off neighbour is looking gloomy because he might have lost the cash which he had stored in secret lockers. This thinking has a domino effect, a chain reaction spreading across all sections of the society.
The political effect of demonetization is almost like the political fallout of Indira Gandhi’s decision to stop Privy Purse, a payment made to the ruling royal or lower families of erstwhile princely states as part of their agreements to first integrate with Indian in 1947 and later to merge their states in 1949 whereby they lost all ruling rights. The Privy Purse was continued to the royal families until the 26th Amendment in 1971 by which all their privileges and allowances from the Central Government ceased to exist. After a legal battle, it was implemented after two years. With the stopping of Privy Purse, all the ex-royals were unhappy and their majority “subjects”—the common masses and the poor– hailed Indira Gandhi for striking a blow on the supremacy of the ex-royals. This is also one stroke that made Indira Gandhi became popular among the poor and the downtrodden.
Prime Minister Narendra Modi, despite his attempt to change the narrative to a campaign for less cash society to woo the neo-techno savvy youth by promoting digital transactions, is exactly trying to impress upon the poor rural masses and the lower middle class that demonetization was a master stroke against corruption, terrorism, Naxalism and so on. In one stroke, Prime Minister Narendra Modi has become the only Prime Minister, after Indira Gandhi, to become ‘so popular’ in every nook and corner of the country.
But unlike in 1971, people across the country now have got access to the outside world and are more politically and socially empowered. People believe that Indian economy has been provided with a new lease of life and they want that its benefits should percolate down to the masses in terms of check on price rise, more employment opportunities and more investments for a better quality of life both in urban and rural areas. That’s where the real test lies.