The Narendra Modi-led government is all set for another surgical strike on its fellow countrymen. The central government is all set to phase out Rs 2000 note, and introduce Rs 200 notes. The dates are still unclear but media reports say that the RBI will launch the new Rs 200 note in this coming months.
Well the question still remains why is the government so much into phasing out notes or demonetising currency notes. Has the government found a genie which is telling to do so or have they found a numerologist who is telling them to do this to increase the GDP growth. This can only be answered by Narendra Modi-led BJP government, but for now the answer is clear they copied the idea, yet again.
Narendra Modi-led government is no new to when it comes to taking credit for someone else’s idea or work. Remember 8 November 2016, when Narendra Modi appeared on TV, at midnight, and announcing demonetisation, and also said it is the best thought plan by the BJP-led government, and which will also curb black money problem, counterfeiting and terrorism. He also mentioned his government was thinking about this for a long time and planned this to clear the black money from the economy. Well really, Mr Modi was this your idea? Are you sure you didn’t copy it from anybody else. Let me take to you six months back from November 8, to May 2016, when European Central Bank announced that it will permanently end the production of 500 euro note and introduce new series 100 and 200 euro notes. But they also said that they will permanently phase out 500 euro notes at the end of 2018.
Well, they also gave time of 2 years to completely phase out the 500 euro note, and also buy time to stabilise their economy during the phasing out of the 500 euro note. Not like Indian government who demonetised Rs 500 and Rs 1000 just in one day, without giving it a thought of will the Indian economy recover after that move. Still, there is no sign of GDP growth stabilising, still people are facing problems of Rs 2000 note, and when people were getting acquainted with all of these yet again government will be introducing new Rs 200 notes.
Well, even the European Central Bank took years of expertise even before announcing the phasing out of 500 euro note. They had setup expert panel just to study the fact and effects of it on the economy. And the European Central Bank also said that existing bills can also be exchanged at national central banks of Eurozone nations for an unlimited period of time. The move was prompted by the note’s suspected use in criminal activities like fraud and terrorist financing. Another major concern about the notes – particularly in Spain, which supported ending circulation of the 500-euro note – is how they have aided smugglers who move large sums of money around Europe and all over the world.
Well thought plan for years, but the move is criticised till now. The ECB’s move was to move towards cashless society. But, it also took time of two years to stabilise and increase the resources to do so. So well coming back to Indian economy, while copying the steps of European Central Bank, Reserve Bank of India to took the same points and applied it.
The government also have a reason to create a cashless society: digital transactions make it far easier to regulate cash flows in and out of the country, and keep track of who is holding on to what. After all, digitally transferred money where can be easily tracked—cash on the other hand, generally does not come with GPS. That would allow government to make policies such as negative interest rates and capital controls potentially more effective.
Of course, according to their reasoning, only bad people who engage in criminal activity, tax evasion, and terror financing use Rs 500 and Rs 2000 notes. All of us law-abiding little people have no need for such high denomination cash. That’s a very convenient view for the Government and telling people that it will help the Indian economy and increase GDP growth but well we still can’t see that. Common man is still facing problems and there are no signs of economy stabilising. Well Narendra Modi-led government should find a numerologist because the numbers are not on their side.
The views expressed by the writer are personal)