‘Oh, what a tangled web we weave…when first we practice to deceive.’ – Walter Scott, Marmion
After sounding the bugle for ‘War on black money’ on the night of 8th November, the Generals appear to have changed the tack, hardly three weeks into it. Prime Minister’s ‘Mann ki Baat’ and the RBI Governor’s interview on 27th November emphasised the need for ‘Going cashless’ with less cash. It is interesting to note that the Government’s press release and the Prime Minister’s speech announcing demonetisation harped primarily on the issue of ‘black money’ and terror funding through counterfeit notes. There wasn’t much about ‘Going cashless’ then. There is an obvious shift in the narrative. While one can agree to the fact that there exists a (close) association between ‘cash’ payments and ‘black money’, it needs to be recognised that they are not the same. Curbing black money and encouraging ‘cashless’ payments are two different objectives. The means and methods to achieve those objectives would have to be different. Leaving aside the political motives of the party in power, the new objective and policies of the government need to be assessed based on the ground reality and the consequences.
There are estimates that ‘black money’ in the form of currency notes does not exceed 6% of the total ‘black money’.… Read More