With this post, i reach the second mile-stone in my Blog, the 200th post.
On the 8th November, 2017, the Indian Government celebrated as the Anti-Black Money Day (people on the other side of the political divide observed it as a Black Day). High denomination notes of Rs. 1000 and Rs. 500 (almost 86% of the money-supply) were de-monetised on the 8th November, 2016.
After this event, i had published 3 blog-posts titled ‘Dhan ki Baat I, II and II on the 8, 9th and 10th January, 2017.
I had been following reports on the effect of this de-monetisation and i was wavering on whether it was beneficial or harmful for the country; however, the scale in my mind was tilting in favour of this decision.
On the 8th November, 2017, newspapers carried reports of the Finance Minister Arun Jaitley’s statement that demonetization was an “ethical and moral step”. The Opposition Parties led by Congress, a ramshackle party which failed to secure even 10% of the seats in the Lok Sabha in 2014 elections, to claim the position of Leader of Opposition, observed the day as a Black Day. One may dismiss as a mere power-play, what the Congress Vice President Rahul Gandhi said on the subject. But when the seasoned economist and former Prime Minister Dr. Manmohan Singh, who became the P.M., courtesy the Congress President Sonia Gandhi (The journalist Sanjay Baru book on him is titled ‘The Accidental Prime Minister’.) branded demonetization as “an organized loot and legalized plunder”, one would have taken notice. But it seemed that his economic analysis was coloured by the political situation in which he has placed himself. The United Progressive Alliance led by Congress and supported by C P M -Communist Party of India (Marxist) - was in power from 2004 to 2014, with Dr. Singh as P M. Its uncharitable critics dubbed the coalition as having 3 PMs: P M (Dr. Singh), C P M and an ‘S P M’ (Super P M Sonia Gandhi as Chairman of the specially created for her, the National Advisory Council).
However, the reasoned editorial of The Economic Times of the 8th November 2017 analysed the overall picture, took a balanced view and decided my view of de-monetisation. The first sentence of the editorial stated, “On the first anniversary of de-monetisation, it is unambiguously clear that the project has been a resounding success. It sent out a clear message that the government is determined to clamp down on black money and is prepared to take unorthodox measures for the purpose. … The government would now go after benami property.” Most black money is held as real estate, gold and other assets. The editorial went on to say that even most of the amount held in cash came back but at a cost to the black money holders; they had to employ people, directly or indirectly, to deposit the money in banks. And this has left a trail which the authorities are investigating.
This, i think, gives a correct picture.