Last week, the Modi party celebrated one year of “successful” demonetization. Congress did the ritual of observing it as a “Black day”. Before proceeding further on the topic, let me quote some important points from my article published in Feb 2017 in a Punjabi magazine.

• On 08-11-2016 Modi, in his address to the people, had promised that he is thrusting this decision for three reasons :

1. Demonetization of Rs. 1000- and Rs 500- notes would finish total black money, claimed to be almost equal to white money. He and his supporters’ teams pleaded that black money is always kept in high denomination notes, hence with banning of these two highest value notes, black money would be wiped out. The “Experts” yelled full throat that Modi has done wonder!!
2. It would wipe out fake currency. There were reports of fake currency notes being seized every day at that time. As all notes were to be deposited in the Banks, hence there was no chance of fake notes to remain in circulation.
3. It will end terrorism. Modi & party claimed that terrorists from Pak bring fake notes and also sell/purchase weapons with high denomination notes. Many “Defence Experts” with typical crescent moustache cropped up on TV screens and thanked Modi for his fantastic move. They went to the extent of claiming that with the ban on 500/1000 notes, the terrorism has no choice but to starve.

Frankly speaking, I am not an expert economist but being a Banker, I did have a little practical knowledge of the economy. Hence I wrote that prima facie, the purposes told by Modi were baseless and hollow. And the demonetization has some ulterior motive. Today, after one year, I can yell: I was right.

So far as one year’s period 8-11-2016 to 07-11-2017 is concerned, we encountered following facts:

• As usual, Modi was completely insensitive to the hardships caused to the common public. And it was just inhuman on his part that he did not even speak a single word of condolence for those 120+ persons who lost their lives solely because of his note-bandi.
• The news items and information received thru RTI applications of past one year revealed that the decision of demonetization was, as quoted by Arun Shourie, taken by two and half persons. (Modi & Shah and Jaitely). None of them had even studied Economics during their school days. That is why, in first 50 days of demonetization, rules were amended for 61

Might be, this is one of the reasons for Google to include Modi’s name in the list of “Most Stupid PMs” or for his speeches like “If a village builds graveyard for Muslims/Christians, it must also build a funeral pyre for the Hindus.”

Anyhow, it is the matter of utter shame for “We, the People of India..” that we are having such a person as our PM whose name figures in “Google search” not only in the list of “Most Stupid PMs of the world” but also in the list of “Top 10 criminals of the world.” No other ruler of the world has achieved this distinction.

I am personally upset because I have read Edicts of Emperor Ashoka who is revered world over even today, for his illustrious works of public welfare. The Welfare State Rules framed by the Emperor are being followed by all without any amendment for 22 centuries!! He opened Universities, hospitals not only for Indians but also for Greeks, Romans and Egyptians in their countries. And Modi is asking for building graveyards and funeral pyres. Just see how low we have fallen!!

• I had written that there are two types of Black money.

1. First, that is earned but proper/full tax is not paid for it. It can be legalized any time by paying due tax and penalty.
2. Second, that is procured thru illegal means viz. fraud, extortion, bribery, misappropriation of criminal activities. It can never be legalized.

I had explicitly expressed my doubts about the ulterior motive of the 2½ persons’ claim of recovering Black money thru this step. Particularly when Modi made two declarations: First that no inquiry whatsoever shall be made for any cash deposited in the accounts of any Political Party and second that if anyone declares the amount of his “black money” and pays 50% of it as tax; the source of the black money shall not be inquired into.

Was it not an open invitation to all criminals to legalize their booty by paying half of it as a tax? A simple question: where should Modi’s name figure, if not in the two lists mentioned above? It is, however, a different matter that none accepted his offer.

• With demonetization not only new employment generation vanished but even those in employment lost their jobs. How much? No confirmed data is available but every other family in India has story of his near & dear losing the job. Literally, it was a curse to unskilled labourers. How many of them starved, nobody will inquire into.
• GDP has come down by almost half. The slowdown is visible in all sectors. The sales on Diwali too have gone down by 30 to 50%. Every shopkeeper lamented that there was “no Diwali” this time.
• Housing and manufacturing sectors are the worst hit. What to talk about new projects, the in-process projects too have been abandoned. Billions of Rupees of the general public in the housing sector are either drowned or on the verge of drowning. The Lehman effect is enveloping Indian housing sector also. The prices of new house have fallen by 40%.
• The most important fact is that 100% currency notes of Rs. 1000 and Rs. 500 which were in circulation, have come back in the Bank. And the Modi Govt has failed to catch even single black-marketer!! The billion dollar question is: where has the black money gone?

This is the question; no media person is posing to Modi who, clapping his hands, had declared that within 50 days all black-money holders would be put behind bars! If he failed, he be hanged at any crossing.

• Is it not shocking that with Modi’s move of demonetization, the whole of the black-money has been converted into white without any need to touch even a single criminal? What a superb move!! Fantastic!! No criminal would have ever thought of making his ill-gotten money into legal money in such a smooth way! What else should Shourie have called it other than a state-sponsored organized loot?
• The sold-out media was yelling “honest Modi’s daring step” but his party-men were caught with as many as whooping Rs. 252 crore new currency notes of Rs. 2000- within 30 days of demonetization!! The CBI NIA CVC all are mum on the matter. Why? Everybody knows the reason. In Punjabi it is said: Kaun kahe Rani nu, agga dhak i.e. who dare tell the Queen to cover her frontal nakedness.
• So far his claim of controlling terrorism with demonetization of 1000 and 500 notes, I termed it a childish rather an insane plea. Every prudent man knows that terrorists are not money-oriented. It does not matter at all to Putohit, Pragya, Aseema, Dawood, Masood or Roshan in which denomination their weapons have been procured; whether these are procured thru 2000 notes or US Dollars, Euros or Pounds! They commit terror not for money but due to their hatred against humanity. And hatred cannot be controlled thru demonetization of particular currency notes!
• So far fake currency is concerned; it is again shocking fact that the banks exchanged all currency notes but NOT EVEN SINGLE instance was reported that a man was caught exchanging fake notes. Surprisingly, with demonetization, every Indian became an expert in note testing and none went to the Bank with fake note. What happened to fake notes, only time will tell. RBI has not made and perhaps will never make public the figure of fake currency notes, deposited by “the public” during demonetization move.
• It is also worth noting that a duo (sister brother) were caught in Chandigarh who printed fake currency notes of Rs. 2000- worth Rs. 4 crore in just 15-20 days of launching of the new note. The BJPians allege that Pak printed and supplied fake currency notes of 1000- 500; hence Modi demonetized them! How ridiculous this plea is!! Do Pakis not know counting of 2000 or are they so poor that they cannot afford to print Rs. 2000- notes?

In nutshell, the move of demonetization was a shrewd move to legalize black money for the politicians and the super-rich. However, every citizen of India was given an opportunity to participate in this loot. How I explain:

1. Those who topped the list are the politicians. The Modi Govt allowed all politicians to deposit in their party fund any number of notes of any value. There was no limit for them to deposit money in the party’s Bank a/cs. They were assured thru the law that none shall inquire into their deposits.
2. Second to politicians are the top brass officers. Again the Modi govt assured them that their a/cs shall not be looked into by any anti-corruption agency until Govt i.e. Modi allows them to do so.
3. Third place is occupied by the middle and lower level of Govt employees. For them, Govt declared that anyone could deposit Rs. 2.50 in his a/c. No inquiry shall be made. Hence an officer or employee who had procured 5-10-20 lacs in bribes got a God-gift to make his ill-gotten money into legal. He deposited the cash in his near dears a/cs. All bribe monies legalized! What else could be God-gift for such corrupt employees?
4. Below them came daily wage earners. They too got a commission in “assisting” the rich by standing in Bank lines. Many got 1000- to 5000- for depositing money in their a/cs. But the genuine persons standing in lines cried and some lost their lives too.
5. The “agriculturists” i.e. who had income from agriculture too harvested crop of currency notes. They exchanged their “agriculture income” @ 10 to 20% premium. That is pay Rs. 10 lac in cash and get back a transfer of 80/90000 thru Bank a/c with an undertaking that if any inquiry happens, the transferred amount may be shown as debt or gift.
6. The otherwise unnoticeable meek Bank employees to got status in the society. Most of them exchanged notes to please someone. And some of them exchanged notes at commission also.

Thus everyone got a chance to participate in the note-bandi loot. ONLY two Mothers suffered. First, the house-hold Mother who stealthily saved and saved for decades, petty amount of cash in the boxes of sugar and dals. She was made to part from her hard-earned savings and deposit the same in Banks. Second is our Mother India whose “money” was gobbled by the super-rich to the tune of more than 8 lac crores. Modi govt wrote off loans worth Rs. 2 lac crores of these entrepreneurs. Now it plans to waive off their remaining amount so that they could be eligible to again show their entrepreneurship.

In plain words, it is the limit. Hence better would be if we call it “De-moral-ization” move rather than demonetization.

Author – Kuldip Kumar