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Demonetised Nation

Demonetised Nation

I AM old enough to remember the ill-effects of the 1962 war with China, the series of wars with Pakistan, including the liberation of Bangladesh, and all the terrorist attacks from Akshardham to Parliament to Pathankot to Uri. I have an anecdote or two to share about every such incident in the country that happened since the sixties when I became a teenager. For want of space I refrain from doing so.

I can also say without fear of contradiction that one episode that impacted almost every person in the country was the demonetisation Prime Minister Narendra Modi triumphantly announced on November 8 when he addressed the nation from a makeshift All India Radio studio. Not even the Emergency had affected the common people as this one. He gave the impression that the problems of the people with regard to the revolutionary fiscal step would last, at the worst, just a few days.

When Modi realised that he had stirred a hornets’ nest, he told the nation with tearful eyes that if he failed to restore normalcy within 50 days which would end in December, he was ready to receive any punishment from the people. Let history decide what punishment he should get but in the meanwhile I met some victims of demonetisation, none of whom was a hoarder of black money.

D’Souza has a daughter of marriageable age. It was with some difficulty that he was able to find a groom for his daughter. That was when he realised that there was great difficulty in withdrawing the little money he had saved over the years to marry off his daughter. Standing in the queue for his own money was an ugly experience from which he could not escape.

He had to print invitation cards, buy bridal dress and some jewellery for the daughter, book a hall, pay the caterer an advance and meet other incidental expenses. For all this he needed money. Since his financial condition was not all that great, he also expected his relatives and friends to chip in with some money to tide over his financial crisis. He himself had helped many friends and relatives on occasions like marriages. People kept an account of the money received on such occasions so that they could return the money when the person from whom they received it needed money.

It is a system applicable to all communities -- Hindus, Muslims or Christians. He could not expect much from his relatives as they themselves were facing a financial crisis with ATMs dispensing just one Rs 2,000 note at a time and that, too, after standing in the queue for a long time.

D’Souza was very happy to hear the Modi government making an announcement that anyone could withdraw up to Rs 2.5 lakh for a purpose like marriage. He wrote an application to the Bank Manager and he attached a wedding card to it. He knew that the money was not sufficient but he also knew that it would go a long way in meeting his immediate need. He met the bank manager and he took care to take a copy of the newspaper in which the report appeared about the government’s generous offer.

The manager read the application with great sympathy and told him that, first of all, he did not have money. D’Souza was ready to wait for a couple of days. No, that also would not serve the purpose. He will have to get the application endorsed by the District Collector. That is when he realised that withdrawing Rs 2.5 lakh from his own account was a Herculean task.

Since he was a needy man he rushed to the Collector’s office. Thank God, he lived at a district headquarter town, he thought, as the auto-rickshaw sped. A friendly middle man guided him to the person concerned at the Collectorate. He told him bluntly that to get the collector’s endorsement and approval, he will have to produce several documents, including the  aadhar card. 

More important, he should give a written statement on how the Rs 2,50,000 would be spent. If Rs 25,000 was towards paying for the marriage hall and Rs 1 lakh towards the caterer and the rest to buy dress and jewellery, he should get a letter from each party why they needed cash and not a cheque. He knew that none of the parties concerned like the caterer would give such a certificate. 

Realisation dawned on him that Rs 2.5 lakh was like the breast the hen told its chickens that she would have the next day so that they could also have milk like the little lambs got from their mother!

D’Souza is a honourable man. He does not curse Modi or his government. Instead, he curses himself that he wasted two days on chasing the mirage of Rs 2.50 lakh. Since he does not want the marriage to be disrupted, he has found ingenious ways of getting credit from his relatives by presenting them with cheques for Rs 24,000 each.

Raghavan Nair’s case was more pathetic. An LIC agent, the roof of his new house under construction was to be cast on November 9, a day after Modi shocked the nation with his 48-minute staccato speech he delivered in both Hindi and English. He had to make a lump sum payment to the contractor, who with some difficulty arranged a sufficient number of workers to complete the work in one day.

Nair did not have a single rupee with him. He was planning to take the money from the bank. He was forced to postpone the work as he did not have cash to give the workers. Some workers came and returned disappointed. Of course, they did not blame Nair as they knew his difficulty. Over the last one and a half months, Nair had been going to the bank and ATMs to withdraw enough money to complete the roof-casting work.

As I write this, Nair has managed to raise enough money to meet the contractor’s demand. Alas, money alone cannot build a house. Workers are needed. The contractor had a group of workers under him. They were all from Assam and West Bengal. Called migrant labourers, they numbered about 30-40 lakh in Kerala. With no work, many of them have returned to their native villages. Nair’s house is yet to have a roof as the contractor is unable to find labourers.

Construction work has come to a standstill almost all over the country. Tens of millions of workers have lost their jobs. And they include carpenters, masons and blacksmiths. I met a furniture shop owner in New Delhi. He employed 40 workers, mostly carpenters. With a sudden drastic fall in business, he was forced to lay off 20 of his staff. He feared that if the crisis continued, he would have to lay off more staff and even close down his business.

A relative who is the manager of a tea estate in Assam has been having a harrowing time since Modi went on air on November 8. His estate had about 1100 workers and his main job was to make their payments. In the Assam tea gardens, the workers are paid wages every week. And the payments have always been in cash.

In fact, the law stipulates that they should be paid only in cash. A cheque payment can be made only if the person concerned makes a written request. This is the law of the land which Modi could have easily amended with the brute majority he enjoys in the Lok Sabha. The victim is my relative. After Modi’s spectacular speech, the banks found that the demand for money was much more than they could dispense because they did not get enough new Rs 2000 and Rs 500 notes.

A system was evolved in Assam. Every tea estate had to make a written request specifying the exact amount required to pay the workers. Once the requests reached the District Magistrate he would sanction payment. Then the banks would release the money. All this was easier said than done. The tea estate managements were not able to adhere to the payment schedule. The district authorities encouraged the estate owners to shift to the cheque payment mode. In pursuance of this order, my relative got almost all the workers to open bank accounts, though the law did not allow using any compulsion.

Every week my relative got a list of 1100 workers prepared and sent to the bank to transfer money to the individual accounts. Again, there was a problem. The local bank did not have enough staff to key into their computer system all 1100 names and the amounts against each name in a day or two. “They said they need a week’s time to do so as they are also busy dealing with the unprecedented rush to the banks”. 

As a result, the workers did not get their wages on time. They are not rich people. They usually do not have any savings as theirs is a hand-to-mouth existence. What else could they do, except strike work? And that is what they did twice in the last one and a half months. My relative is a harassed man, thanks to Modi’s fiscal fireworks.

This writer knows pretty well a school in Haryana which caters to the poor. It has over 850 students. The fees for girl students is Rs 100 per month. In the higher classes the fees go up to Rs 400 in the case of boys. In December the fee collection till the time of writing this column was less than Rs 10,000. The parents say that they do not have money to pay but the NGO which runs the school has to find ways to pay salaries to the teachers and other staff.

The parents were encouraged to pay fees through cheque but most of them do not have cheque books as they are mostly illiterates. Most of the students are first-generation learners. It is pointless to blame the parents when they themselves have lost work as work in the stone quarries in the area has stopped. 

The most pathetic case I came across was about a person who sold a portion of his land to marry off his daughter. This was a few days before Modi’s speech.

Land prices were high and he could get a reasonably good price. He received the money in cash, all in 500 and 1000 rupee notes. He is a poor man who does not have the resources or influence to get cash from the bank. He had no option but to deposit the money in the bank to save his old notes. Since the deposit is a substantial sum by his standards, he fears income tax scrutiny.

Of course, he can prove that the money is legitimate, though he may not have shown the real amount of transaction to save some money on the land registration cost. But his real problem is that having deposited the sale proceeds in the bank, he does not know how to take it out and hold his daughter’s marriage ceremony.

None of the characters in the stories I narrated above is like the leader of a political party, who organised a marriage programme in Karnataka that cost him a small sum of Rs 500 crore. Money was not an issue for a Union Minister who also organised a marriage reception at Nagpur where many turned up in chartered aircraft and helicopters.

How I wish Modi had travelled the length and breadth of the country as an ordinary man with a few 2000-rupee notes! He would have realised how ordinary restaurants after restaurants would refuse to serve him his favourite dhokla when they knew that he had only a Rs 2000 to offer. I am not exaggerating as I met a young man at Kochi who did not get the lunch coupon when he offered a Rs 2,000 note. “It is the third restaurant refusing food to me” he said.

Modi knows personally Savji Dholakia, a prominent Gujarati diamond merchant, who has 8,000 workers and a Rs 12,000 crore turnover, as I have seen a photograph where Modi honours him. Dholakia earned some fame when he sent his only son, who studies business management in the US, to Kerala with just Rs 6000 and no credit or debit card. He was supposed to live for a month in Kerala and return with at least the same amount or more by working at an establishment for not more than one week each.

Dholakia’s son worked as a sales person at a bakery and a footwear shop, among others, and returned to Surat with Rs 8,000 in his pocket. The father was proud to narrate this story at a function to felicitate him in New Delhi. He wanted his son to realise the difficulties of life. Today if he were to send his son to Kerala, he would have returned without getting a job as businesses were down in the dumps and recruitments were a no-no, thanks to a fellow Gujarati’s brainwave!

The writer, a senior journalist, can be reached at

(Published on 26th December 2016, Volume XXVIII, Issue 52)#