Economic uncertainty needs and end with Law taking its own course
The rhetorical flourish over any unsavory incident or unhappy event by the concerned minister or the politician is that law would take its own course. However notwithstanding such sound demonstration of logic and credibility the nagging question remains whether the law is really allowed to take its course. There are multiple roadblocks in failing the law to take its own course. Despite all the protestation of such sound statement the fact remains that the political interference serves the umbilical cord between the prejudiced circumstances and the failure of law in taking its own course. It is said in our country that show me the person and I would give the law or its twisted version. More convincing is that the law can well be employed and twisted depending on the different identities of the persons. The convenient twisting of law is always beneficial to the persons with money and muscle. The socio-politic life in our country is no more than a business proposition where there is no fear of consequence for the open flouting of law. The politics is a business without any investment with the attendant sharp fall in the virtues of discipline and benevolence. Against these declining standards of public life the honest implementation of law has only remained a far cry and fictitious with the blinkered vision and myopic approach sometimes born of communal consideration.
This logic is equally applicable to the economic affairs also. By virtue of the banking norms the common man is required to mortgage his property in exchange for obtaining the loan. The situation gets so low with the fact that the interest multiplies with the delay in payment and there comes the stage that even with the payment exceeding the principal amount the principal amount remains. In the event of failure of the payment of the dues the proceedings of the attachment of the property can’t be ruled out. While the commoner has to pay through his or her nose the same yardstick is not applied to the rich and the affluent. They have the potential to benefit from secured and unsecured loans both. The secured loans are based on mortgaging the required property or asset and the unsecured loan is based on some project or otherwise. While the commoner has to grapple with the depth of the loan crisis the business tycoons or the big fishes do not witness the stakes soaring very high with the default.
While discussing the finance of the country the mention of Reserve Bank of India is quite inevitable. The Reserve Bank is the apex body in the complexity of the banking system. It is the banker of the banks. It has the monopoly of issuing the notes but equally assigned with other functions like being banker to the Government, last resort to the bank, concerned with the cash credit reservation, controller of credit so on and so forth. It does not interfere with the release or disbursement of the loan but also monitors the implementation of the banking norms in the Nationalized and multiple other banks with other denominations. The Nationalized Banks are those which have shares of the government no less than 51% and it is variable above the required minimum share of 51%. These banks are in the ownership of the Government.
With reference to the current economic condition, it can well be said that quite a huge loan was advanced to the business tycoons from the Nationalized or other banks and intriguingly the loan was failed to be recovered. It is said that the accounts of the business sharks are declared N.P.A. and some huge loans of aggregating to the several thousand crores were waived.
The basic question is as to how the situation was allowed to evolve into the availability of the deeply huge loan without any restraint.
It is said that the expanding fiscal deficit likely to cause the loss of financial equilibrium is one of the reasons for the abrupt demonetization of high value currency notes of Rs.1,000/- and Rs.5,00/-. The subject is too technical to have the over simplification of the facts. However despite the deeply technical nature of the subject the aforesaid situation has come to the fore and formed the subject of discussion. The basic question is was the Modi government in deep slumber over the economically unsettled conditions leading to the decision of the demonetization of the high value currency. Does it suggest that the big fishes were allowed to have their pound of flesh over the clandestine election funding.
With the current phase of demonetization, the Government of the Day gave the reasons behind demonetization as to flush out black money, to remove counterfeit currency and stop terror funding. The stated objectives of the Government of the Day very much aroused the welcome by the people. The stated desire of the Government is a matter of applause for the people. However the fact of the matter is whether the grounds shown by the Government have the logic to sustain reason and rationality.
With reference to the much hyped objective of flushing out black money, it can be recalled that in the time of smugglers like Haji Mastan, Yusuf Patel, Narain Sukur Bhakia and others there was the concept of storing and concealing the black money in some remote corner of the room, wall, cupboard or somewhere else. It was the time when the Government Agencies were to raid the premises to unearth the enormous wealth of black money.
Now the time has changed and with the change of time, the idea of accumulating the hard cash and conceal it somewhere has gone defunct. Now the unaccounted cash is turned into investment in real estate, bullion, foreign currency, hundies, gold, foreign accounts etc. Besides what is not easy to reconcile with the sudden Government decision is the circulation of black cash which is less that 6%.
Concerning the counterfeit currency the ratio is extremely less than one percent and with the existence of counterfeit currency extremely less than one percent the objective shown by the Government behind demonetization move is rather baffling.
With reference to the terror funding, it is said that international currency is largely used in the terror funding.
Hence the reasons advanced by the Government for demonetization are not plausible enough to necessitate such move.
In the circumstance, it can well be recalled that Prime Minister Modi has said that he would bring black money stacked in Swiss bank. The Swiss bank can’t dispossess any information concerning the storing unaccounted Indian money as it is the custodian of the unaccounted money of many countries of which the need for the secrecy is to be maintained. Any disclosure of the unaccounted wealth by the Swiss bank would trigger the withdrawal of the cash of the other countries which may facilitate the collapse of the Swiss bank. No one burns one’s own house to provide light to the others.
There is no denying the fact that Prime Minister Modi has kept harping on the theme of bringing the black money from abroad. In that situation, no one is expected to put all the eggs in one basket. In a similar situation would the accused not develop any precaution if the police would keep reminding him that his premises would be searched.
While on one hand the reasons for such drastic step are yet to be satisfied the method of implementing the whole situation has raised another perpetual question. The whole country has plunged into unprecedented chaos, confusion and untold misery leading to a large number of deaths including the bank employees with the escalating stress. The cash crunch in the banks ATM centres etc. has witnessed long queues spiralling into the dislocation of normal life.
The worst hit are those poor who do not have the banking access and the small time labourers. The small time labourers are already underpaid by their employers and in the current situation, their salaries or payment is further reduced. The people do not change their life style to help others.
Now Modi talks of cashless economy being clueless about harsh grassroot realities. The ever growing disparity between the rich and the poor can’t be bypassed in the context of cashless economy. The intriguing extreme poverty can’t be insulated with the need to go for cashless transaction. The depth of the extreme unstable economic plight can be illustrated with the condition of a watchman who offers dozens of salutes in a lust to obtain the note of Rs.10/- which is too small to fetch anything. The watchman is there in the society, shop, bar, hotel or any other place.
What is no less than intriguing is to note that the economic disparity growing into a chasm has reduced the poor living into subhuman condition. The increasing sub human condition of the poor and destitute can well be illustrated in the couplet of eminent poet Irtaza Nishat who said
Sabse dilchasp gam hai meri basti ka
Mout pasmanda ilakuo me dawa lagti hai
[The most interesting traumatic grief of my dwelling is Death is the panacea for painful existence].
The poor and needy are very much constrained to make two ends meet and the Prime Minister Modi would like to see that these poor and destitute to do the payment through internet Even the West and the Middle East flooded with wealth have not dispensed with the need of currency.
The overall situation in the Country is discomfiting and chaotic with the people very much disgusted and frustrated with the absence of alternate relief measures with the demonetization move. The people are expressing their deep sense of dissent with the prevailing situation which can’t be brushed aside in the name of flawed concept of nationalism and the cashless economy.
The note ban has stagnated bulk of the commercial activities and there is no end to the sufferings of the people. Above all there are glorious uncertainties with the demonetization as to what would be the next surprising move of the government and whether present agonising situation would end and whether the country would revert back to the period before November 8, 2016, the day which began a reign of chaos in the normal life of the citizens. Such uncertainty is not good for nation’s health.