PM Modi creating illusion of curbing black money through demonetization

Prime Minister Narendra Modi justified demonetisation to curb black money but he is absolutely giving wrong and absurd arguments in front of ignorant people of India. Demonetization is making Government rich and people more poor.

Black money is not that amount of money saved by the taxpayers in house for running the household but it is related to financial transactions that referred to a range of activities which are undertaken either illegally or to avoid huge amount of taxes like in arms trade, drug smuggling, trafficking or any illegal activities and also certain legal transactions like gold or diamond, platinum high end jewelry purchases to avoid high taxes. 

Indian economy is in turmoil after PM Modi couldn’t find the real way to curb the menace of black money through government punitive actions against people rather announced demonetisation of Rs 500 and Rs1000 notes and introduced a much high value denomination of RS2000 to encourage the black marketeers and that too with no security feature in the note.

With the introduction of Rs2000 note which has no security features will drastically reduce the value of Indian currency in the global markets thus India would lose its “world’s fastest-growing economy” tag due to the impact of the de-monetisation of currency.  

Rather decommissioning of high currency notes will have a negative effect on  rural people specially farmers, Middle class people .There are still some small businesses, shop keepers, traders, house hold servants, daily wagers where cash is the only mode of payment. The largest impact of the government’s move will be in the unorganised sector, which isn’t represented in the markets.

Now when the Indian economy is in bad shape, the cost of printing the value of Rs500, Rs 1000 notes will put extra financial burden.Cost of printing + replenishment and maintenance of ATMs ie notes of 100 and of 2000 denominations.

The timing of the implementation has put severe burden on agriculture sector where the farmers will not be able to sow its next crop to be harvested in May 2017.Consequently ,India should be ready to cope with acute food shortage next year that may would bring in famine like situation.For getting a true lesson, Modi government should learn the causes of Bengal feminine that resulted in huge loss of lives.

This demonetisation will lead to unjustified increase in bank deposits which is going to adversely impact consumption demand in the economy and government will be obliged to reduce interests rates on fixed deposits  and people will be forced to invest in risky stock market to the glee of corporate sector which will fund the government in the 2019 elections.

Moreover, Centre for Media Studies report showed that nearly Rs 30,000 crore was spent during the 2014 general election, while official spending only accounted for Rs 7,000-Rs 8,000 crore. It is very much known that BJP used holograms for campiagning in 2014 elections the most expensive campaigning in the history of India till date. 

Blackmoney will circulate even after demonetization  

Government is bringing a bill in the Parliament to amend the Prevention of Corruption Act 1988 whereby  public servants can be prosecuted only after prior approval of the government.

Another important aspect is that the religious institutions including temples, sikh gurudwaras, etc or religious persons like Ram Rahim Singh  who have thousands of followers are not affected by  PM’s move as the money of religious institutions would not come under the ambit of black money  so the corrupt people are in contact with these people to make their money white.

arti bali

By : Arti Bali Senior Journalist

Related Posts