The masterstroke of taking away the legality of Rs 500/1000 notes has created enough brouhaha in media including the ever active (overactive!!) social media. Without going into the motives/timing/desirability etc. etc, here are some random thoughts about its aftereffects.
There will be widespread inconveniences to a lot of people for a few days. But except for a very few, in almost all cases, these will be like a mild irritant and not like a major disruption. Except on the first day (9/11), today onward, options are available for sourcing currency for emergent needs. After all, how many really poor will be seriously inconvenienced if they are unable to use 500/1000 Rs notes on a randomly given day.
Against this scenario we have to weigh in the real impact of this decision, which lies in a diametrically opposite direction of the society. Just one example will suffice:-
Many political parties are crying due to the difficulties faced by the common man. All these parties are on record saying that their opponents are super corrupt and have hoards of ill begotten cash. These cash chests have suddenly become useless now. Should not these parties show happiness because the opponent parties will loose the money edge? This point is not even properly mentioned by most of the parties. This message comes across mainly through jokes, memes, cartoons etc.
There may be thousand other ways in which black money is being managed. But the most useless (economically) and most useful (for fueling further corruption) is the direct cash storage. Even by the most pessimistic storage estimates, this amount will be a humongous sum. A large proportion of it will be rendered useless now. As an after effect of this wonderful achievement, the population as a whole will suffer small inconveniences for a few days. Was there any better way to achieve this? Not so long ago, I remember thousands of people marching on the roads for anti-corruption campaigns suffering much greater inconveniences without any real/tangible hope of dealing such a devastating blow to the corrupt. So why crib now?
But it is an unfinished task. The root cause has not been addressed and there is no provision for preventing future corruption and hoarding. To progress further on the path of this noble cause, it is essential that major sources of cash transactions are directly targeted and steps taken to limit the option of large scale cash usage.
Everyone talks of sectors like jewellery and real estate. But what about widespread leakages associated with other respectable professions. Take two major white-collar, highly educated professions – Doctors and Lawyers. How many individual professionals in these two fields make any effort to facilitate use of non-cash instruments? How many Supreme Court senior Lawyers take all their heavy fees through non-cash instruments (cheques, DDs, Bank transfer, Paytm, etc)? How many Doctors have allowed patients to pay through such instruments? I have no idea. Your guess is as good as mine.
In these days of extensive technical advances, how tough will it be to enable payment methods for even individual practitioners to use such technologies and to do away with large mounds of cash. Why does public discourse never go beyond the trader and the shopkeeper whenever questions of large scale cash handling and associated problems are discussed?
A move towards cashless dealing is imperative to reap the benefits of this momentous decision. Some simple steps are enumerated below:
- Make PAN of buyer and seller compulsory while registering property deeds.
- The full sale value should be payable only through non cash instruments and the details compulsorily written in the document.
- Data entry of these financial entries into the registration network and linking it to master IT database.
- Frequent surveillance of large format jewellery stores to discover “PAN less” transactions and taking immediate action against violators.
- Extending the ban on large cash transactions to more and more sectors progressively.
- Using academic sector to discover discrepancies in the figures for a given PAN. The data may be suitably redacted to prevent any individual identification.
A Ray of Hope has Emerged After a very long and dark period, marked by total indifference to corruption; both by the powers that be and the public at large.
May better sense prevail all around and let there be more reasons to smile for the rule follower and straightforward persons than the crooked ones.