Panic, chaos, excitement, but India has welcomed Modi's demonetisation drive
I conducted a WhatsApp survey.
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On November 8, Prime Minister Narendra Modi bowled a googly that clean-bowled the people of India. The declaration that notes of Rs 500 and Rs 1,000 have ceased to be legal tender took the country by storm.
Some smiled, others ran to jewellery shops, locked themselves up to count cash and chartered accountants' phones kept ringing.
Middlemen designed schemes to circumvent the ban. Some politicians called the move "draconian". Homemakers began to collect Rs 5 and Rs 100 notes and decide how day-to-day expenses would be met. Support staff at home and work, who had not spent their Diwali bonus, wanted leave to exchange notes and collect Rs 100 notes for daily expenditure.
In short, there was chaos, panic and excitement over the biggest reform that any government has undertaken in recent times.
On November 10, I was standing at a vada pav stall where the conversation veered to Modi's latest "surgical strike". The owner was happy that those with black money were left with currency that had no value. His cook from Uttar Pradesh added that their village had got LPG connections, Ujjwala scheme, for the first time.
The next morning, a car cleaner, with a wicked smile, asked our building sweeper to check if the garbage box had Rs 500 notes. Since the announcement was made, there have been reports of cash shortage, long lines outside ATMs, hardships due to inability to buy daily items and so on. Banks have been working overtime and the situation improved somewhat by Sunday.
In order to know first-hand what the people of India thought about Modi's biggest political gamble, the author conducted a WhatsApp survey. While their responses cannot be seen to represent India's 125 crore citizens, they provide insights. Names have been withheld and the responses edited for language only.
1) Leh shop sales lady: A good start towards black money removal. Though there is some chaos, people are happy.
2) Tawang government employee: People welcomed demonetisation. As the population is less and villagers do not have much of cash at home, whatever they needed for daily use was exchanged and deposited in their accounts. There was a huge turnout at banks just as we see while seeking blessings in Gonpa (monastery), locally termed as Wang.
3) Pune real estate broker: My friends are happy about the fact that this will, to a great extent, flush out/kill black money. I saw some poor people in the line trying to put up with inconvenience but they seemed happy.
4) Mumbai shopowner: People are facing problems in buying items of daily needs. But everyone is still happy with it, since they know it is for their betterment. The poor have taken short term loans, for eg I have given Rs 500 each to the maids in office and at home.
5) Trivandrum banker: The common man is upset because he cannot buy milk, vegetables, fish etc. Hospitals especially private ones refused to accept Rs 500 and Rs 1,000 notes. Fisherman could not go fishing as they could not buy kerosene. Black money holders bought gold for Rs 35,000 per 10 gram - happened in Balaramapuram.
6) Kolkata homemaker: Even poor people are happy. All are positive about this bold move.
7) Bengaluru retired MNC professional: Fantastic strategy, bad tactics. If we go past without people breaking out in anger and frustration, we can easily hit 9-10 per cent growth rate.
8) Srinagar economist: The effect is not as intense as it is in the rest of the country. The implications have not yet sunk in. However, the poor seem to be happy because it affects the rich.
9) Moreh, Manipur government employee: Militant groups in Myanmar, who had collected crores of rupees in extortion, are in a fix. They are contacting people in Kolkata for help. Local traders are unhappy over insufficient supply of currency. Problems compounded by the fact that United Naga Council has effected an economic blockade.
10) Delhi software professional: People are responding with a positive attitude. Even my Ola cab-driver, a follower of Ambedkar from Uttar Pradesh, said he was excited with the clean-up and the level playing field it will create for honest and hard-working people.
11) Mumbai human resource professional: While standing in line, a suave customer asked the bank branch manager if they had cash counting machines. He said yes. Within 20 minutes, the customer's wife came with a sack full of notes. The manager asked how much money is in the bag? The customer said: "I do not know, just take out Rs 2,49,000, the rest I am yet to decide what to do."
12) Amritsar government employee: I am in Kerala right now. People are looking happy. I suffered a lot because I was in the train when this happened and did not have a single valid note. A waiter helped and then I exchanged money from a bank. At home, my family is happy. Some people in Amritsar misguided the poor who got Rs 600 for a Rs 1,000 note.
13) Chennai businessman: I live in Chennai and have my business in Hyderabad. My dad told me on day one - son, one thing you cannot do is hide your income and not pay taxes. My auditor called me a day before and said, you are the only one who is relaxing. Your stand stays vindicated.
14) Puri sculptor and businessman: Poor and rich overall happy. Only the corrupt people are in trouble.
15) Swami from Jammu who co-runs a school: People are supporting positively. Sometimes long lines are there but everything is going peacefully.
16) Dehradun NGO employee: On balance, apart from inconvenience, it's too early to speak of outcomes, apart from the political advantage that the ruling elements will gain having caught the opposition off-guard and stuck with lots of worthless paper.
17) Thane homemaker: She went to exchange notes at a private sector bank. Pointing towards four trunks of fake notes, bank staff were telling customers how to distinguish between fake and legal currency.Why do we forget that money was withdrawn by cheque before ATMs entered the country. (Photo: AP)
18) Udupi self-employed: Been in ATM lines twice now. At least in Udupi, disciplined crowds and overwhelming support for demonetisation move. Even senior citizens are not complaining.
19) Hyderabad professional: Now is the time for the civil society to rise and make this strike on black money successful by stepping forward to support, accommodate and adjust to the system and fellow citizens.
20) Mumbai CEO, MNC services company: I have not detected anger at all against demonetisation. People have taken it cheerfully and in their stride. Although there are lines to collect money, there is a clear sense of pride that they are participitating in something good.
21) Bhopal lawyer and consultant: Lines at banks have reduced considerably. However, the situation in small towns and rural areas is not so good. Logistics problems in supply of currency to ATMs are continuing.
22) Rishikesh driver: He told a friend that he was in favour of this and it will only be a problem for those who have crores of rupees lying with them.
23) Bengaluru cost accountant: Was speaking to my pharmacist. He said people are buying medicines for months together. He said his distributors have stopped accepting cash, moved to banking lines and are giving longer credits.
24) Kolkata senior citizen: I stayed in a line at the bank for three hours yesterday and made a withdrawal. I am a 63-year-old diabetic man. If I can do it, why cannot today's youth?
25) Delhi senior citizen: Had problems with a leading private sector bank on November 10. On 11th, all problems were sorted out, deposits and withdrawals. Do not even need next week's quota of Rs 20,000 or Rs 30,000. This is a great national service, in fact, it is changing the feelings and mindsets of our people.
26) Coimbatore hotel room boy: Dhanda ekdum nahin hai par parwah nahin, accha hai seth log ka hawa tight hai.
27) Chennai management professional: House support staff in our complex is fine with demonetisation. Many residents offered to help them with filling forms, etc.
28) Mumbai aam aadmi: Loving it man. After all these years of paying taxes and gasping at people with 100 per cent more income but not paying a dime, we feel vindicated for sticking to the straight and narrow path.
29) Puri photographer: Foreign tourists did face some problems but efforts are being made to help.
30) Mumbai CA: Bookies shut, gambling dens shut, senior bureaucrats almost confirming they would be burning up their cash, hawala operators have disappeared, plus loads of illegal activity shut forever.
Here are some observations on the events of last week.
One, people of India did not take the prime minister's statements seriously. Note the steps taken by the government to make banking inclusive and disclose black money, etc. First, an opportunity was given to the common man to open a bank account under the Jan Dhan Yojana. The government entered into revised treaties with most countries in which unaccounted money goes through hawala.
Further excise duty was levied on gold and tax collection at the source was made compulsory for cash transactions above Rs 2 lakh. The Prohibition of Benami Property Transactions Act was passed. And lastly, holders of black money were given a last chance to come clean through the Income Declaration Scheme 2016. Only then was demonetisation introduced. Unfortunately, most Indians assumed that like before, the government talks but does little.
Two, large amounts of fake notes are being reported. It is difficult to quantify but that there is a serious problem is widely acknowledged. The government must start an advertising campaign to enlighten citizens on how to identify a fake note from a genuine one.
Three, poor and compliant citizens have supported this move in large numbers. The business community has supported the move, even if not fully and wholeheartedly.
Four, we first blamed Modi for not effecting big bang reforms. Now that one is effected, we are complaining about the inconvenience and shedding tears for the poor. Do Indians want big change or just use it as an excuse to beat every government with?
Five, we are unable to put up with inconvenience even when we know it is for our good. No pain, no gain.
Six, having lost money and business, many small and medium-size enterprises might now use banking/cashless transactions.
Seven, why do we forget that money was withdrawn by cheque before ATMs entered the country 20-odd years ago? However, the government could have told people that every ATM has to be manually recalibrated, and that it would take at least four working days, so use a cheque book instead.
Eight, the media has stories of kirana stores giving credit to customers, rich and poor. According to a friend, on November 9, Ramashray restaurant in Matunga Mumbai told customers who did not have cash to "pay when able". It is compassion that is the soul of India.
Nine, as a nation we are very good at finding fault but sparingly applaud good work. When customers got impatient at a five-minute delay in opening of my bank branch, the branch manager said "be patient, the team left at 2.30am and reached at 9am". A cross cultural trainer is often told by expatriates who come to work in India that we sparingly use the word "thank you".
How about applauding the hard work of bankers, the Reserve Bank of India and finance ministry officials and raising a toast in their name.
The fight against black money, in right earnest, has just begun. Abhi Dilli door hai!