MILPITAS, CA: On Sunday December 18, core think-tank volunteers of Overseas Friends of BJP (Northern California) led by Mr. Chandru Bhambhra, met in Milpitas, CA to discuss demonetization initiative taken by PM Modi in India.
Some of the members who were present in India during November brought back their personal experiences and insights.
The overall consensus was in favor of the initiative towards fiscal transparency, digitization and gearing India’s economic structure towards a cashless society. India being as diverse and economically disparate, the transition is definitely not an easy one and cannot be as smooth in practice as it’s devised on paper.
But it has been incredible to witness how Indian citizens have risen to the occasion to support PM Modi’s efforts in undoing decades of corruption, money laundering, unaccountability among government, top-tier entrepreneurs and higher up businesses and bureaucrats.
Some of the observations that the NRI OFBJP members made were:
• Non-cooperation in non BJP run states resulting to chaos and deceptions.
• ATM machines that are owned and run by individuals lacked credibility in the methods of currency distribution.
• Bank officials involved in scams and offering personal favors to certain clientele added to manipulations in the distribution process.
• Certain rural areas lacking basic infrastructure aren’t prepared enough to go through cash-less economy like farmers, wholesale retailers etc.
• NRIs in possession of old currency abroad still don’t have any alternative process in place to convert their old bills as not all visit India every year.
• However, as reported in the Wall Street Journal, “Once the initial inconvenience of lining up to exchange the old bills or withdraw cash from overburdened ATMs subsides, the argument goes, India would have taken a giant step toward using credit cards, electronic payments and checks rather than cash. This ought to draw more people into the tax net and reduce the amount of untaxed income sloshing around the economy. The only people who stand to lose are corrupt politicians and businessmen sitting atop mountains of untaxed cash, and terrorist groups that traffic in counterfeit Indian currency.” This giant step by PM Modi is expected to bring great rewards.
• To begin with, demonetization has put the 20 trillion human trafficking industry to a staggering halt.
Chandru Bhambhra welcomed all and asked the members to talk on three points during discussion:
1- How did each one of them personally like this Initiative?
2- What were their observations so far?
3- Their personal suggestions if any for making this initiative more successful.
He said demonetization is a courageous step in the right direction. Also the idea of introducing Rs 2000 bills in the Banks two days before demonetizing the old bills of Rs 500 & 1000 was great else the Bank employees would have become suspicious.
There probably was a miscalculation about the amount of deposits coming back to the banks. The supply of new rupees 2000 bills was short in comparison to the deposit from old bills. But Government of India did quite well to improvise along the way.
He also said that some of his friends from India had told him that many of the ATM Machines were owned by individuals and those owners themselves were corrupt and involved in diverting the money in other directions for making extra bucks! Some bank managers also may have acted out of a corrupt mindset or under pressure from their respective State leaders and sold the new bills at a profit margin.
Still the Government will come out with flying colors, only if they can take proper care of poor people, particularly the smaller villages by supplying larger quantities of smaller bills there. So far the Government has done well in raiding the corrupt but still this process should be made more stringent and Government should not spare any political leaders. Anyone found guilty should be punished immediately.
He also said that after some time these new bills of rupees 2000 should also be demonetized and at that time sufficient time should be given to people to deposit. Preferably then the rupee 100 bill should be kept the biggest bill in India.
Lalji Goswami felt that the reasons behind this demonetization move were, to stop black money and terrorism, improve on digitization. Execution has been poor. He has personally heard of trouble from resident Indian businessmen.
Somanjana Chatterjee opined that the attitude of over-regulation has been inherited by Indian governments from British rule. PM Modi is looking to change that. During this process, some chaos is to be expected.
Mahadev Karadigudda broadly supports the move and execution. It is a bold step. The scale of the exercise is such that there cannot be an execution with zero pain. Feel sorry for those suffering. But government of India has been listening to ground reports and improvising along the way. There will be long-term benefits of this move. Violence in Kashmir has significantly reduced and large scale surrender of Naxalites has also happened.
Shivu Vibhuti welcomed the step of demonetization. It is a gutsy step. Personally spoke with a carpenter who is very supportive of the step. Some NRIs had trouble as they had to spend part of their vacation to convert currency. Some bank managers misused their power. Onus is on income tax department to behave honestly.
Prabhu Patil supported demonetization. After Pokhran tests under Atalji, this is the next biggest step in India. People trust PM Modi, so they generally support the move. Execution could have been better with increased supply of lower denomination currency.
Rajan Sadagopan said that initially, general public support was awesome. As time went on, there has been some frustration. Opposition parties have been trying to add fuel to this frustration. In Tamil Nadu, Cyclone Vardah made it worse. People are beginning to suspect banks.
Dinesh Neelavar said that this is transition. Even the Rs. 2000 bill can be demonetized over a period of time. He is concerned about fake news being propagated. Execution has been best ever in the world.
Sunil Ganu said that PM Modi’s visionary leadership is the main reason for the success of demonetization. Taking out 86% of currency is a huge task. The fact that about Rs 13 lakh crore has come back is a concern. Some bank officials may be corrupt.
Gaurav Patwardhan said that he absolutely supports demonetization a very bold step taken by PM Modiji to stop the black money circulation in India.
His observations on his visit to India in November 2016, are: Only common people stand in lines at ATM Banks to withdraw cash and it has become very difficult for a common man to operate on day to day basis due to shortage of cash.
Only Metro cities like Mumbai and Delhi had 500 Rs new notes and Tier 2 cities like Nagpur, from where he belongs, had only 2000 Rs bills. He said that new bills distributed by RBI should be tracked by serial number to ensure accountability.
There is a $70/passport limit to exchange at International Airports which needs to be increased.
Several suggestions came from members, about how to assist NRIs with old Indian currency.
Finally all agreed on one suggestion that the Government should ask the Indian banks abroad that up to certain date, they should collect old currency by limiting the amount per passport and issue a Certificate to the NRl for the amount collected which in turn the NRI can exchange for new bills within may be 2-3 years on reaching India.
Coping up with any change always entails certain challenges, and India’s economy has certainly gone through a lot. From independent free markets in the pre-colonization era to insanely regulated ones during the British Raj, to communist- socialist governments in independent India for decades and, now, gearing up to global economic resurgence, India with more than a billion population is looking forward to a new dawn in 2017.
India Post News Service
