Finance Minister Arun Jaitley on Friday said that replacing 86 per cent of the currency in circulation with new bank notes could not have been executed in a better way being witnessed. No government in the modern world has so willfully disrupted the lives of one billion people with such disdain and so little preparation while also seeming to speak with callousness towards the suffering public. That someone of Jaitley’s calibre should speak this language, revealing not a trace of remorse at the havoc the lack of preparation is unleashing across the country, betrays a cavalier approach to governance. It is inconceivable that a government elected to protect the welfare of its people would embark on such a momentous decision with very little or no preparation whatsoever.
Let us look at the state of preparation as on November 8 when the earth-shaking announcement was made. As many as 2,200 crore bank notes were pulled out of circulation after one speech. No one explained how this staggering stock would be replenished or how soon. According to some reports, even if all the Reserve Bank of India (RBI) printing presses were engaged in non-stop printing for the last three months, at the maximum capacity of 300 crore notes per month, it would take another three months to reach anywhere near the required replenishment. As many as 21,000 ATMs and 8,000 cash deposit machines, according to a statement attributed to the State Bank of India chairperson, was functioning on November 11. This is just 10 per cent of the installed capacity of over 200,000. The number increased to 30,000 by November 18. As not more than 12,000 ATMs can be recalibrated per day, it would take at least another 20 days to cover the country. Even though the recalibration was taking time, the government was not found wanting in calibrating its response on a daily basis by announcing a slew of procedural changes only to prove how ill prepared it was. The idea of distributing Rs 2,000 in place of the removed 1,000 and 500 notes epitomises the scatter-brained approach to the exercise, as the Rs 2,000 notes is practically useless as a negotiable tender. In a country of 1.3 billion, the number of active savings account holders is estimated to be not more 400 million. Even granting that the government assumed all of them would be accessing their accounts to deposit and exchange old currencies, how did it expect the rest of the country to support itself when a virtual currency ban was in place? Transactions by debit/credit cards are so minuscule that it does not even merit consideration as a viable alternative.
The need for obliterating black money from the system is not debatable. The debate is about preparation, plan and execution. That the mandarins in the finance ministry, assuming that they were consulted, could not make this basic assessment is shocking for what it reveals of the quality of advice that is tendered by them. One of the biggest casualties of this move is the independence of the RBI, which suddenly has become another arm of the finance ministry, singing to the latter’s tune. In any set-up, private or government, there would have been a huge price to pay for this colossal failure. But in India today all that is required is an emotional appeal to the patriotism of every Indian.
Prem Bhanu, Mumbai
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