An inconvenient truth! The politics of currency delegalisation in India.

Due credit and apology to Mr Al Gore for using his title. I found it apt for this post.

The Indian Govt. last week delegalised (I believe that is the correct term for the move and not demonetise, as media keeps repeating) 1000 and 500 Rs currency notes and since then all hell has broken loose. The Govt. gave their reasons for the move which everyone knows so I won't delve into. We are all witnessing the mayhem that has followed, with people standing in long queues endlessly outside banks and politicos & media having a field day.

There have been stray arguments on why the move is wrong from an Economics perspective. Mostly calling on history. I have not come across any sound Economic logic against the move. Hence noise has shifted to conspiracy theories and the core issue of inconvenience to public. Since inconvenience is the primary theme for those opposing this move, I want to talk about just this. And hopefully make people think and possibly (I am an ever optimist) do their bit.

I don't question the opposition parties opposing the move. It is by very definition their job to oppose. This move is so big and bold that if it succeeds, all the opposition parties stand to loose big time among their vote banks. I understand their need to find every fault and throw every ounce of mud they can at this move and the Govt. It is a question of their survival. Their motive is clear. Their main plank, 'inconvenience' to the common man, is the only resonation they can hope to find among their voters.

I can also understand the motive of some of the media channels and publications strongly opposing the move on grounds of 'inconvenience'. A lot of media houses are formed on the principals of anti-establishment. Some of them strongly support ideology of opposition parties. Most journalists are unable to comprehend the economic impact of a move this big therefore cannot argue for or against it with any authority. However it is easy to show the plight of people. Take a camera out, shoot some pictures of people in ques and hey presto you have a news story for prime time. Their move and motive become apparent.

What I fail to understand is the commentary by the so called educated 'elite'. Some of them strongly oppose the move on grounds of 'inconvenience' and 'poor planning. They are flooding all the WhatsApp Groups and Facebook Timelines with their vitriol and incessant re-circulation of rumours and myths. I simply do not understand their motive behind their opposition and their case for 'inconvenience'. I will try to address this 'inconvenience' theory in a minute.

I am not blind nor blinded by any ideology. I can see there is massive inconvenience and chaos. This is an unprecedented situation. The disruption to every single person's life is of an extraordinary magnitude. People do not have money to buy daily needs, transact business or pay any expenses and have to stand in long queues to save their meagre cash possessions. I get that. But I think we all understand that for a vast majority of people this inconvenience is going to be short lived. At a macro level there is likely to be a medium term impact. For a small percentage, used to profiteering from the cash economy, the inconvenience could be long and hard. Only time will tell. However no one can predict this. Therefore the least we can do is wait and watch rather than sermonise. But thats not what the elite are doing. They are predicting doomsday basis their 'inconvenience' theory.

Let me place before you 'inconveniences' that a billion plus Indians face everyday for the last..., like forever. Yet no one is concerned. No one is doing anything effective. No one is staging dharnas. Nothing.

1. Inconvenience to commuters in endless traffic jams because of lack of infrastructure and poor traffic management.
2. Inconvenience to farmers of parched land, forced to kill themselves, because we don't have proper irrigation and water management systems.
3. Inconvenience to unemployed youth because, resorting to menial jobs or unlawful activities, because there is not enough industrial development to create jobs.
4. Inconvenience to all citizens due to lack of power. Many villages remain unnelectrified.
5. Inconvenience to millions of children forced to drop out of school, condemned to a life of low wages and poverty.
6. Inconvenience to city dwellers choking under life threatening pollution levels.
7. Inconvenience to mothers forced to abort their foetus because of its gender.
8. Inconvenience to businesses from lack of power, water, logistics and abundance of red tape and corruption.
9. Inconvenience to commuters from VIP motorcades and lal-batti
10. Inconvenience to people having to go through security at offices, markets, stations, airports..., because the threat of terror ever looms large.
11. Inconvenience to the religious, having to stand in long queues to get a glimpse of their creator.
12. Inconvenience to our soldiers at Siachen standing in -40 degrees condition so we can earn more and more money.
13. Inconvenience to those seeking justice who have to wait decades for the courts to clear their cases

...

The list of inconveniences is endless. The fact is, if you are born in India, barring a few hundred people, inconvenience is one of the building blocks of your DNA. Nothing is easy here. Day to day life is inconvenient. As hell. Right now I am breathing air well beyond danger levels which could be robbing me of my lifespan. But who cares.

The move to delegalise currency is a big bold move. The govt claims by doing this, it can start to remove some of the above inconveniences. With more money coming into Govt coffers, infrastructure can be improved, industry can be encouraged, farmers can get better prices with transparency (recorded transactions), more schools and medical centres. With counterfeit and cash gone, terror threats can be brought down.

Not all ills will vanish. Infact very little of some of the above would probably. But lets give it a chance. Let things pan out. Go through a few days of hardship even if there is a minuscule chance that some good will come out for everyone.

People talk about poor planning. Have anyone of those saying this handled anything of even one millionth the magnitude? This move is like holding ten snap polls (general elections) together. With no prior warning. The way the banking system has taken to the task is beyond any praise that can be showered on them. It goes to show when pushed to a wall, every Indian is up to the task. There is no record of any operation anywhere in the world which has been done at this scale, with so much secrecy. The problems are created by people trying to beat the system, yet again, to protect their ill-gotten gains.

I know why a lot of so called elite, vehemently opposing, are doing so. They have been the largest beneficiaries of the cash economy. They are scared of losing past and future gains and getting exposed. Others may just be misguided by political rhetoric or personal bias.

If we have to worry about inconvenience of one move, lets take a pledge to eradicate all inconveniences. Let's make a 'convenient' India. India without any ills. If we have to oppose this move on the grounds of 'inconvenience' and stage dharnas, lets us stage a dharna for all the above inconveniences. Let us ask for a roll back of pollution. Lets us ask for a roll back of traffic jams, of female featicide, of farmer deaths, of unemployment, of archaic laws, of martyred soldiers.

And if we can't, the least we can do is let people do what we elected them to do. And we can help. Those around us, not so educated or fortunate, to tide over the crisis. Enable the unbanked to get onto the system. Stop forwarding rumours. Stop paying in cash. Stop bribing. Stop complaining.

I usually don't write on current or political issues. Do not have a crusader in me. It is just that I felt strongly about the venom some very well informed are spewing which pushed me to place my views. I know there will be a lot of strong counter views and arguments. Happy to debate with an open mind.