VOX POPULI
by
S Kamat
as
Aam Admi
Issue: 182 Date: 02.01.2017
Contents:
1. 1. Modi & His Demonetisation
Ways: A Possible Alternate Method
2. 2. Modi Should Change Tack & Aim At Politicians and Government
Employees
3. 3. Modi Should Come Clean On Gujarat Corruption
Charge
Modi & His Demonetisation
Ways: A Possible Alternate Method
In the context of the
demonetisation exercise launched by Narendra Modi from Nov 8th 2016, he has
been asking the people if they accept demonetisation. There are no two
things about it because to fight black money and corruption demonetisation is
an effective measure and the people will accept the premise. In fact Modi's addresses to the public are nothing
short of rhetorical questions which from the pulpit that he is speaking from,
he obviously cannot get any answers and his speeches tend to be of the rabble
rousing kind. The comment that you can make in this context is that Modi cannot
be in electioneering mode when he has to handle matters of governance. Modi also
questions the people on matters where they have little or not so complete
understanding and then claims that the public are with him be it on demonetization or fighting
black money. Even while touching
upon the number of circulars put out by RBI on the demonetisation issue, he
talks of sensitive government while the other side of the coin is a government
which does not know what it is doing.
In reality, the question that
Modi should have asked the people is whether the demonetisation measure
was implemented properly and
whether the people are happy about it? Now that is an embarrassing question, is
it not Mr Modi? There are a further number of simple questions which the
people have on which Mr Modi should give the answers, like:
1.
On Nov 8th 2016, how many new Rs. 500 notes were available with the RBI for
distribution?
2.
How much currency did the BJP party deposit in banks 30 days prior to Nov 8th
2016? Give a day-wise schedule of deposits.
3.
Why have the BJP MP's & MLA's not submitted their bank statements for the
period from Nov 8th 2016 till date to Amit Shah?
4.
Who is the mole in Modi’s inner circle working for the black money syndicate
who has sabotaged his demonetisation exercise? Reasons for the need of this
clarification is that this person must have suggested the multiple id's for
exchanging the demonetised notes and pushed for the demonetisation with only
the new notes of Rs. 2000 and practically no Rs. 500 notes guaranteeing
confusion and public uproar that has lasted close to two months now with cash
drawals from banks being limited for which there does not seem any end in sight
in the near future. By this measure the demonetization was kept that much ajar
so that they could escape with little damage. This matter could be deliberate
at the party level by the BJP whose upper echelons had full awareness of and
for which the party would have been compensated since the State elections were
imminent. Or the mole would have feathered his nest so that a thousand
generations of his would not have to worry for their future.
Modi
has been saying that he is not afraid to tackle tough issues. That's fine but Modi
should he not set an example of practising what he preaches. Is he personally
willing to face the consequences of his decisions? We are sure that Modi had
some of the demonetised notes. Did he go and stand in line to exchange the
notes like any other common citizen? To get the feel of the situation did he go
and stand in front of an ATM to find that the cash had run out when he had been
in the line for about two hours. That would have been the real way to show that
Modi knows what the common man has been going through during this
demonetisation exercise. It is easy to sit in air conditioned offices and claim
that one knows what the man on the street feels or faces but it is yet another
thing to be out there on the street with the common man. The problem is that we
want to emulate the Western way of life and their leaders but still want to
retain the Indian way of using the trappings of office to avoid the compliance
to procedures that are required to be done by common people. Keep Modi aside,
no BJP MP or MLA was seen in any queue across the country exchanging money or
drawing cash from ATM’s though they made many newspaper headlines with many BJP
leaders caught with large stashes of demonetized notes.
The
answers to the above questions are from what is apparent from newspaper reports
and the RTI’s filed with RBI is as follows:
1. On Nov 8th
when the demonetisation of the old Rs. 500 & Rs. 1000 notes was announced,
apart from the sample notes that Shaktikanta Das waved during the press
conference immediately after Modi’s announcement, there were no new Rs. 500
with the RBI. That is the reason why the new RBI Governor, Urjit Patel’s
signature is on these notes and not Raghuram Rajan’s, the previous RBI
Governor. If as Modi’s claim this exercise was in the planning for 10 months
then it is obvious that Raghuram Rajan’s signature would be on these new notes
and there would also have been adequate quantity of these notes available for
distribution. The printing of the new Rs. 500 notes in bulk started only after
Nov 8th.
2. 2. Apart from the Rs. 8
crores that the Bengal BJP deposited in banks in Kolkata even after the
scheduled closing time on Nov 8th, there would have been deposits by
the BJP party and their legislators who would have got prior information about
the demonetization, in banks across the country. The country wants to know
these figures. Additionally post – Nov 8th the BJP MP’s and
ministers were given the facility of exchanging their old demonetised notes
with new currency. In this exercise it is understood that Arun Jaitley, the
Finance Minister topped the list with Rs. 68 Lakhs. Are these deposits being
looked at with the same magnifying glass by the IT authorities wherein all
deposits in excess of Rs. 2.5 Lakhs will be matched with their IT returns and
known sources of income and if there is a mismatch, penalties would be levied
as declared?
3. 3. There has been no news
of any MP or MLA submitting his bank statements for the period from Nov 8th
onwards to Amit Shah. To ensure compliance, should Modi not take the lead and
submit his bank statements for this period so that other BJP legislators can
follow suit.
4. 4. There is obviously a mole
in Modi’s inner circle who leaked the news of the demonetisation to the black
money syndicate who must be the same person who allowed for multiple ids to be
used for exchange of demonetized notes at banks and post offices. If only
people who had accounts at the respective banks and post offices been allowed
to exchange notes only there then you could have easily segregated those with
no bank accounts. For such people a
separate counter could have been formed thus allowing the possibility that some
of these people would be those exchanging money for the black money syndicate.
Then it would have allowed the authorities to go after those among this bunch
whom they consider suspicious and thus achieve some success in getting closer
to the black money syndicate. For a pithy mistake by the authorities the IT Dept. are now suspecting a large number of people who in the majority
may be innocent being questioned for their hard earned money and also
increasing the workload of the authorities needlessly.
In summarising this entire demonetization
exercise, one does not understand - Where was the reason to panic? Considering
that over the last 2 years or more the money supply had been growing far in
excess of the country’s GDP which indicated that the currency, mostly the large
denomination notes were being used for other purposes either black money
activities or for terrorist funding etc. etc. Note that the spurt in currency
and its mismatch with GDP figures was mostly in the Modi era after 2014. Then
in April – May 2015 the Gujarat daily had talked of demonetization of large
denomination notes, then in July – August 2016 – there was talk of a Rs. 2000
note being launched and then in September 2016 – there was talk of a new Rs.
500 series. Putting all this together Modi hit panic stations end Oct and then
spilt the beans on Nov 8, 2016. This was no way to go for a mature and rational
individual used to the ways of large scale policy initiatives. What needed to
be done was that to defer the demonetization to lull the black money syndicate
into comfort, but introduce the Rs. 2000 note and then the new Rs. 500 note
when it became available in sufficient volume. Then we would have three
denominations of Rs. 2000, Rs. 1000 and the Rs. 500 but actually 4 types of
notes since the Rs. 500 would be of two types. This would have set the black
money syndicate at ease confirming their information that new notes were coming
but the expected demonetization was not happening. Then about a year down the
road or even later, since there was no emergency to start the fight against
black money, pull out the Rs. 2000 and the old Rs. 1000 and Rs. 500 notes while
launching a new Rs. 1000 note. This would have left the public with the
denominations of Rs. 1000 and Rs. 500 as earlier. This process would have also
given more than enough time to print the new series of Rs. 1000 which would not
have set off alarm bells ringing since with new notes of Rs. 2000 and Rs. 500,
a new note of Rs. 1000 was logical. When the new Rs. 2000 would be demonetized
then it would have wiped out almost 90% of the black money held in cash since
by that time the Rs. 2000 would have graduated to the status of preferred note
for black money stashes and the pulling out of the old Rs. 500 would be of no
consequence. This is what is called – riding the wave, changing things according
to necessity but keeping the larger perspective in mind. Unfortunately
these are aspects which Modi has not learnt since his approach is that if you
see an ant go after it with a hammer!
Modi Should Change Tack & Aim At
Politicians and Government Employees
Modi's demonetisation has not made even a minor
dent in reducing black money and corruption. The whole exercise has been to
exhibit misplaced bravado and hide adverse facts and promote those that seek to
extol demonetisation. To give you an example NHAI has estimated that it
will have to pay Rs. 922 crores to private toll booth operators across the
country to compensate them for exempting payment of tolls by highway users in
the period from the afternoon of 9th Nov to midnight of 2nd Dec. Similarly the
operators who fill ATM's with cash are likely to send a bill in excess of Rs.
400 crores to the government for the loss in their operations
because firstly, they are not being given enough cash to fill ATM's which
activity has dropped from an average per ATM of Rs. 7 lakhs/day
to Rs. 1.5 lakhs/day and secondly, most of these operators keep
the ATM's functioning on a fee per transaction which has drastically
dropped since the number of hours of ATM working has been drastically reduced
and non-functional ATM's far exceed the ones that are working. Thus
if you take just the Rs. 922 crores the NHAI has to shell out, it is far
in excess of the aggregate total of all seizures made since Nov 8th of cash,
both demonetised and new, gold, jewellery and what-have-you. The seizures
made through raids etc. are puny and are nowhere near the estimated size of
actual black money in the country. The continuous news in the media
about seizures is only a publicity stunt to show that the demonetisation
has actually worked.
Demonetisation was an excellent tool to get at
the cash component of black money which Modi & his team muffed up as we
have seen in the last 50 days. But the amount of black money kept in cash is
hardly 10-15% of the total. Thus Modi has to go after the other ways that black
money is kept. Black money in benami properties be it land or otherwise is
another method which Modi says he is going to tackle next. And one is sure that
his further target should be in bringing back the black money abroad. Modi
was to bring back the black money from abroad particularly Swiss banks within
100 days of assuming office but now with more than 800 days having passed there
is nothing in sight. To cover up on his lapse or inability to bring black
money from abroad Modi embarked on his short-sighted binge
of demonetisation which has brought day to day lives in homes and
businesses, in fact every sphere of economic activity across the country to a
near halt.
To fight black money apart from benami properties
Modi has to show the will to tackle election funding by political parties. This
is a major area where black money is deployed. In fact all political
parties needs to be brought under the ambit of the CAG and their accounts
compulsorily audited every year, failing which the Election Commission
should de-register them.
As for the fight against corruption Modi
needs to have the courage to attack two principal groups - politicians and
government employees. Between these two groups more than half the corruption
in India is accounted for. For politicians based on their asset filing
with the Election Commission, IT assessments should be done to see
whether their income matches their assets growth which irrespective of party
affiliation has been growing astronomically each time they file a new
asset form with the EC. When there is this very visible class of people
who have been accumulating ill-gotten wealth staring Modi in the face one
wonders why he is going after looking under each carpet to unearth black money
hoarders? The question is will Modi have the guts to fight his own breed?
As for government employees where corruption is
a way of life for the majority and nothing really moves without the lubricant
of money, Modi should show the will to target them. Modi started with
a lion's roar about making government employees work upon taking over in 2014
but over the 2 years since in 2016, we have found his approach to this
class has been that of a mewing cat. What needs to be done is that Modi
should withdraw the 7th Pay Commission already in place and implement a
'pay for work' salary system based on an incentive scheme. Set the base
salaries of government employees at the levels prior to the 7th Pay
Commission and let them earn the raises of the new scales as an incentive
for better productivity. The Niti Aayog can work out the productivity norms for
all classes of government employees which will be at least some 'productive'
work that they would have done. The shock of demonetisation where some of their
hoards would have been evaporated and the productivity based salary system
should encourage the government employees to put their noses down
into their work or in contrarian terms at the least get involved in finding
ways to beat the new system.
Unless we do the above there is no future for
this country and we will be turning the pages of the book of the saga
of black money and corruption over and over again.
Modi Should Come Clean On Gujarat Corruption
Charge
We are in a curious situation in India where scams are counted by
size and it appears one party wants to outbeat the other by the number of scams
and the value associated with them. Otherwise why should the BJP defend
Narendra Modi against Rahul Gandhi's charge of having taken money from the
Sahara group and the Birlas when he was the Gujarat Chief Minister by saying
that the Congress has been involved in more scams. The scenario here is like
when you are at the circus watching two competing trapeze artists trying
to outbeat each other by going higher and higher, while you watch from
your seat mouth agape in amazement. Is the BJP's lame
defence an indirect admission of Modi's guilt in this corruption
case? Also should Modi as Prime Minister not be interested
in clearing his name of these charges? Therefore it is the
correct time for him to come clean on this matter.
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