#Demonetization : A political step forward towards economic democracy
Source :News Bharati English   Date :08-Jan-2017

Demonetization: A political step forward towards economic democracy

Essentially a political decision of the Party!

It is essentially a political decision of the Party looking forward to usher in economic democracy in the Indian society. A conscious one taken by a duly elected Government of a party along with the alliance enjoying an absolute majority on the floor of the House. The decision is not merely a political one; it is also a legitimate one.

The pretence, the opposition parties show as if these have a sole right to protect the interests of the country and they are the only saviour of the national interests and at the Union level, as if an illegitimate and irresponsible government is taking undue advantage of their being in power and making decisions. It is such a pity that the opposition parties in India find it impossible to come to terms and accept that they have lost almost log, stock and barrel in their electoral run in the May 2014 Lok Sabha General elections. It is not merely a pitiable situation but also a shameful one.

The party in power as at present and the National Democratic Alliance had promised the voters in their election manifesto that stern measures against the corrupt and ‘black money hoarders’ would be taken. It was a political promise. There has been a hue and cry since long by INC and other small party outfits on the issue of ‘black money’ in and outside the parliament Houses. Now the NDA is determined to translate the promise into action in its letter and spirit.

After all politics in a state is making political decisions of the Party and it is the expression of its political and economic policy.  People’s general will is expressed through its voting in the general elections to the legislature and therefore it is a representative democracy as well.

Prime Minister Narendra Modi’s  decision is in a way representative of the character,  moreover, the fact cannot be ignored that the voters have preferred BJP  along with its avowed election manifesto in which a promise was made if elected to power, to fight against corruption and  ‘black money’.

In a parliamentary democracy, political parties have a right to contest elections, and the victorious one has the right and responsibility to rule and govern for the tenure for which they have been elected. The losers have to abide by the rules of the Westminster model of parliamentary democracy. India has adopted the West-minister model. The opposition parties in India seem to have lost the relevance of these rules.

Wikipedia defines parliamentary opposition in a multi-party system ( like in India )  under which it has an ‘official’  ‘ leader of opposition’ ( in West Minister system he is supposed to be the official opposition to the Government of Her Majesty )  and is always the shadow Prime Minister in the waiting. However, the May 2014 political tsunami  in  Indian  federal democracy was  so severe that the then ruling party in power i.e. the INC was almost washed away  to the extent that it could not reach the mandatory required figure of  54 MPs ( 10 % of the total strength  of  the House ) , it could reach only 44 . Therefore, there is no shadow Prime Minister either!

In this context, Mr Muhammad Mushin Iqbal in an article published in Wikipedia DT. 22nd June 2009, has maintained that (quote) ‘parliamentary opposition is a form of political opposition to a designated government, particularly in a Westminster-based parliamentary system. In this context, the opposition forms a recognised, even semi-official “government in waiting”. Its opposition can degenerate into a charade pending the eventual exchange of roles and occupation, or preoccupation, of the Treasury Benches.

By their very presence in the debating chamber, parliamentary oppositions recognise the legitimacy of the system of politics, and thus may share many of the views of the government…..”  (Unquote) Unfortunately, the scenario in the Indian parliament, even such a positive situation does not exist. The debates in the Lok Sabha have degenerated into such a hopeless nadir standard that the term ‘parliamentary debate’ has become hounding and mockingly a ridiculous one.

The falling standard of the debate and of course the behaviour has emerged as a threat to the very political system itself in India.  Mr Mohammad M. Iqbal in his above-mentioned article states ‘parliament is fundamentally the forum wherein tolerance is institutionalised and is the instrument for the peaceful resolution of conflicts and the mediation of differences...  It is the forum where the cardinal principle is respect for acceptance of the other’.

The author further submits that the opposition is required to be loyal to the interests of the state and the nation, it cannot be a  loyal opposition if its manner of opposing is utterly unprincipled or if it seeks to couple constitutionalism with a readiness to exploit unconstitutional means to gain power…. (  note the role played by the opposition party number which is in majority in the Upper House i.e. Rajya Sabha in India and the way in which these have stalled the proceedings of the House during its entire session,  in fact in both the Houses ) …. the majority ( too ) must always be allowed to have its say…the opposition should not perceive its role as a mere mechanism of obstruction and should contribute substantially to the decision-making process.

The opposition is not simply a question of party politics…in a healthy democracy, opposition cuts across party lines to embrace issues on which members of both the majority and the opposition have the courage to challenge their party’s main position ‘.  In the Lok Sabha, the plight of the opposition is seen so miserable and its consequent behaviour became a symbol of impropriety per say. 

Demonetization was announced on 8th November 2016 with reference to   ‘The High Denomination Bank Notes (Demonetization) Act, 1978’. It is interesting to note that despite initial difficulties of possessing  currency in cash  through the banking service and several   ATMs  across the country, ( including  the unexpected  warning   discussed by the Apex  court ),  there was no popular revolt anywhere in the country  except inside the Houses  where the floors of the Houses were made scapegoat on the ‘demonetization’ issue.

Constitution of India appeared hypnotised since the presiding officers of both the Houses looked helpless to act sternly against the erring ones. There was no debate on the issue of demonetization, all that was there, were allegations in un-parliamentary scripts. Encircling the well of the House and stall the proceedings, had become the order of the day. Flimsy and childish demands were put up by the agitating opposition. The intention was quite clear and the target was specific—‘Modi’. The intention was not ‘debate’; it was abusing the government and esp. ‘Modi’. Why was Modi targeted?

The following factors in  the  country added fuel to the fire : (a) Unaccounted cash management  by traders and businessmen , (b)  Unaccounted cash held by petty political party  bosses at lower  levels, ( c ) top echelon of  some corrupt higher bureaucracy  at the Union and federating State levels,  ( d )  alleged top bosses in banking system,  ( e ) alleged  ‘Havana’ racketeers in international  commercial affairs,  ( f ) irrational taxation structure and its consequent tax evasive  individual psyche in the society, ( g ) exaggeration of  interpretation  of democratic practices, ( h ) hostile  media , and  ( I ) of course power crazy  petty political leaders at the lower strata of the society ,  and  many  more.

Modi government has unleashed a sort of unprecedented cleansing programmes in several walks of life and several victims of the corrupt marketers who have been adversely affected, rather punished by the unprecedented calamity, these are at the loggerheads with the government,  screaming for primary survival in politics.

8 the November announcement has sent shock waves amongst the abovementioned spoiler-players in the field. In any way, none of the above players would have corrected their own method of operation on their own volition and voluntarily. A fatal punch was needed. Moreover, there was a long pending feeling nay expectation of a strong punitive action against these players by the common man in the society. Everyone knew that it required a strong political will, daring attitude and above all, ‘nation first’ attitude.

It would suffice to quote Shri Narendra Modi, that in the early 1970’s the then Union Minister late Shri Y.B.Chavan had advised the then Prime Minister late Smt.Indira Gandhi to take demonetization step to curb irregular financial practices in the country, surprisingly Smt.Gandhi rejected the advice saying elections were round the corner ( …and  the party could not run any risk ).  Obviously, the party interests weighed above national interests for the then Prime Minister.

‘All development is politics’, the (late) Professor V.M.Sirsikr, Pune had pronounced. Narendra Modi translated it into action. All major economic decisions are essentially political ones which need to be taken by the political leaders. The quality of political leadership is relevant here.  There was a necessity for someone to emerge and fill the required gap. It would not be an exaggeration to put this way that Modi was the call of the destiny, he emerged and footed the bill.

Political  Leadership  needs   socio-political initiative:                                                                                                    In this regard, the meaning of political initiative  and the political leadership  is  a  leader   with personal integrity and a high degree of commitment to the mission  of development   incorporating  the following components:

A.            Approach towards  disaster management  crisis  management - decision-making competence

B.            Responsive political leadership

C.            Youthful and energetic

D.            Innovative thoughts

E.            Determination to implement

F.            Astuteness

G.           Skilled orator

H.            Deft negotiator

I.             Acceptability by the people

J.             Lovable and affectionate

K.            Acquaintance  of  villages and cities

L.             Ability to research  the  spirit of economy  and   livelihood

M-Urge for  Reconstruction of infrastructure visualisation of reorienting and reorganising administrative structure while identifying genuine needs of the citizens such as water, education, human resource development, power – electricity,  sense of security confidence besides articulating several schemes with good infrastructure for physical and social welfare schemes.

N   Teamwork and good work culture

O   Attitude of application of high technology, such as e- Governance

P   Art of keeping direct link with the citizens

Q  Belief in the concept of “Good governance is good politics”.

Narendra Modi is a leader who has acquired several of these qualities which he has derived from Rashtriya Swayamsevak   Sangh during the period when he was a ‘pracharak’ for as many as 18 years in Gujarat.  Modi has earned his M.A. in Political Science from Gujarat University in the early 1970s. 

Modi is fearless and leads from the front and allows credit to the others. The art of keeping liaison directly with the people is a special character of Narendra   Modi which he has acquired as a Sangh worker.  While performing these activities he takes care not to personally involve himself beyond a certain extent i.e. not to become emotional while discharging his responsibilities.  He has for a very long time in his initial career in the past,  worked with the common man and therefore he knows the very nerve of the common man,  his attitudes,  his aspirations,  his inspirations as well as his ground level realities, problems and limitations.  Anyway,  the poorer sections of the society did not have anything to lose on account of demonetization. These were not affected to any great extent...

Towards economic democracy?

His bold decisive step of introducing demonetization has emerged in the Indian polity as a popular decision to a great extent without encountering any serious threat to the political stability of the country.  The economics of the country to is quite safe in the hands of Narendra Modi. The benefits and positive results are going to yield better fruits in future.  One has to wait. Senior economists and financial experts in the country appear to be so eager to target  Modi that too without verifying the facts and figures,  that these show no patience for the deliverance of the results.

The most pitiable and worthy of condemnation lot is quite a few hostile  ‘media pundits'! Their pedantic stance during TV  debates on the issue of demonetization quickly turns propagandists and their fury is exploded in wild allegations against the Government esp. Narendra  Modi. Most of the discussions are a rampant declaration of ‘hate’ and wild convulsions of pseudo-liberalism.  There is no trace of national interests anywhere in the debates. Nation or nationalism –is it a bourgeoisie term?

However,  in an article published in Times of India, Pune, dated 13th December 2016, the views authored jointly by  J.Bhagavati, P.Krishna  and S.Sunderesan  were positive in examining ‘demonetization'. The article summarises three major benefits—first, around  80%  of the currency is back in the banks, secondly, impressive switch over to digital transactions, and thirdly, dent in counterfeiting and its benefits to the social media. The article concludes “ India,  however, seems to have voted in a Prime Minister who is prepared to take on political risk in his efforts to fulfil his commitment to root out corruption and has promised even more”. The views expressed in the article also point out at the achievements side of the ‘big’ decision.

According to Wikipedia some basic facts are as following:

“Historically, previous Indian governments had demonetized bank notes.  In January 1946, banknotes of 100 and 1,000 rupees were withdrawn and new notes of 100, 500 and 1000 rupees were introduced in 1954. The Janata Party coalition government had again demonetized banknotes of 1,000, 5,000 and 10,000 rupees on 16 January 1978 as a means of curbing counterfeit money and black money.

In 2012, the Central Board of Direct Taxes had recommended against demonetization, saying in a report that "demonetization may not be a solution for tackling black money or economy, which is largely held in the form of Benami properties, bullion and jewellery". According to data from income tax probes, black money holders keep only 6% or less of their ill-gotten wealth as cash, hence targeting this cash may not be a successful strategy.

On 28 October 2016, the total banknotes in circulation in India was 17.77 trillion (US$260 billion). In terms of value, the annual report of Reserve Bank of India (RBI) of 31 March 2016 stated that total bank notes in circulation valued to 16.42 trillion (US$240 billion) of which nearly 86% (around 14.18 trillion (US$210 billion)) were 500 and 1,000 banknotes. In terms of volume, the report stated that 24% (around 22.03 billion) of the total 90266 million banknotes were in circulation. “

(Source:  Wikipedia)

It is interesting to note  that  the  decision of demonetization  found  support from  Arundhati Bhattacharya, Chanda Kochar, Anand  Mahindra,  Sajjan  Jindal, Kunal  Behl, N.R.Narayan Murty, Bihar Chief  Minister  Nitish  Kumar, Andhra  Chief  Minister  Chandrababu Naidu, former  CEC SY Qureshi, Anna  Hazare  and  most  important the President of India  Shri Pranab  Mukherji  called it a bold  step. Abroad, the International Monetary Fund too welcomed the step as a step in fighting corruption. Chinese State media ‘Global Times’ praised the move and termed it as “fierce fight against black money and corruption”. The BBC correspondence Justine Rowlett also praised the move. South East Asian media too praised the move.  Of course, there were several critics too such as a well known left-to-the centre thinker and a   Noble laureate Dr Amartya Sen.  Who termed the move as ‘despotic action ‘. Former  World  Bank economist  Kashia  Basu, Pranab Sen,  Professor  Prabhat  Patnaik,  T.N. Ninan, Deepak  Parekh, WB Chief Minister  Mamata  Banerjee,  Delhi  CM  Arvind  Kejriwal also criticised it. Small political parties like  DMK, AIDMK, JD ( U ),  NCP,  RJD,  SP, BSP, AAP, TMC, Shiv Sena, Patidar  Animal  Andolan  Samiti, NC from J& K  also criticised the move.  The former Indian  Prime  Minister Dr.Manmohan  Singh termed it as  ‘organised loot’ “. There were several  Public Interest Litigations filed in different  Courts of Law in the country and of course in the  Apex court too by habitual litigants.

Upon a careful look at the criticism levelled by the abovementioned critics, no substantial arguments would be found. Except for a few great intellectuals like  Dr.Amatya Sen, Professor  Patnaik and a few others whose points of views need to be taken into account, the rest of the critics made it out of political compulsions.

One has to take into account that India was convulsed completely after 8th of November 2016. It was a different India altogether. Problems and difficulties in the individual’s lifestyle were bound to occur, but the economic system was stable.  Indian  Finance Minister  Arum  Jailed observed that the move ‘ is an attempt to change the spending habit and lifestyle’.  What he meant was that it was imperative on the part of the individual that he switches the gear and brings about a change in his individual accounting system.  Of course, the lower middle class in the society did face day-to-day problems of cash transactions but did pull on life boldly.

These affected poor and the lower middle-class sections fully supported the Government policy.

These unsung heroes suffered but wholeheartedly supported Mode’s idea of ‘nation first’.