Angst and protest likely if cash crunch continues: Mazumdar-Shaw

She adds that people might be losing patience with the government's demonetisation efforts

Kiran Mazumdar Shaw, chairman of biotech major Biocon and one of the most prominent corporate citizens of Bengaluru, fears that if remonetisation efforts aren't stepped up, the country could potentially see protests as people are losing patience due to the absence of cash at banks and ATMs

Shaw has been a supporter of Prime Minister Narendra Modi's demonetisation effort to fight black money and turn India into a digital economy. However, she believes that the move has begun to strain farmer livelihoods which could make them lose support.

"If re-monetisation is not revved by month end to enable normal banking ops in Jan people's patience and support will convert to angst and protest," tweeted Kiran Mazumdar Shaw, chairman and managing director at Biocon.

 

Shaw could not be reached for comment immediately.

India's tech capital Bengaluru has relatively not been so terribly impacted due to the high penetration of credit/debit cards and smartphones for people  to use digital wallets and other online payment mechanisms. However, just a few kilometers from the city, the impact can be seen.

"Trouble is we can't see beyond our urban lives. I am guilty of this as I really don't have insights into rural poverty," said Shaw in response to a comment on her earlier message.

Shaw probably has a better perspective on this impact since Biocon is one of the few corporate giants to be headquartered in the outskirts of Bengaluru. The office is in Bommasandra while it has manufacturing facilities further away in the Jigani industrial estate. The company also employees a significant number of blue collar workers from these localities.

"Why should I be angry? I fully support demonetisation and digital payments. I'm commenting because my sabziwalla who was supporter is now complaining," she added.

Prime Minister Narendra Modi had promised people that the lack of cash would affect their day-to-day lives for 50 days after the announcement was made on November 8. Experts now say they cash crunch could exist till April while the economic impact could linger on for a lot longer.

While pushing for digital payments to fill the void for cash, the government did little to ensure the digital payment infrastructure was scaled prior to announcing the move. The government on Thursday said that it would spend over Rs 340 crore to provide incentives for encouraging the common people to use digital payments.