Why Modi's New Year demonetisation speech was a failure
Government policies are judged not by intent, but by results. That is what Prime Minister Narendra Modi was supposed to tell the nation at the end of the 50-day demonetisation deadline. While Modi speaks almost every day, his year-end speech was the most eagerly awaited in recent history.
His advisors may bury the painful 50 days, however they cannot stop people from analysing the PM's speech in the context of the November 8 noteban shocker.
The nation has remained baffled with four big questions amid the pain of demonetisation, and the answers to them were expected in the speech – and they did not come.
Q1) How much black money was there in cash?
If you can’t measure it, you can’t manage it, goes an old adage. Midway through the drive, finance minister Arun Jaitley surprised all by saying there was no estimation of black money either before or after the demonetisation announcement.
Even if there wasn’t an estimate then, it's high time the PM let the people know how much black money has been unearthed in the aftermath of the noteban - just to ensure that our sacrifices have not gone in vain.
The question has become more pertinent in the light of the fact that the banking system has got back nearly as much cash as there was in circulation.
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| People have been suffering the pain of demonetisation for 50 days. (Photo: India Today) |
Q2) Why have the tainted been offered another chance to escape?
A decisive battle against black money is essential, but has demonetisation been able to curb it? The government has offered another window of escape to tax cheaters. Black money seems to have changed into new pink notes. Banks have proven to be corrupt and inspector raj is on its way back.
Q3) How long will the pain last? What is the revival plan? By when will remonetisation get over?
People were expecting a deadline when limitations on withdrawal of one’s own money will be lifted. This is necessary not just to help the economy revive but also to quell the insecurity prevailing among public after the noteban.
And last but not the least...
Q4) If income tax raids were the only way to net black money, then what was the need to force the nation to bear the demonetisation pain?
Unfortunately, the PM’s speech did not answer any of these puzzles, while he was actually being expected to not just reply to them but also come up with follow-up measures to curb black money.
The speech noticeably exposed the government's dilemma after demonetisation. As 50 days of the drive get over, the PM was expected to do two things.
Either he could have braced up to act against the parallel economy by announcing new measures while leaving an economic revival plan to the Union Budget, or vice versa.
Measures against hoarding of gold and property, tough accounting norms for corporates and cash holding/transaction limits were anticipated by the masses as a follow-up to the drive.
The government has in fact undermined the entire effort by keeping the income tax law (Section 13) for political parties intact and by leaving exemptions under it untouched.
If the government could change the law in the middle of the demonetisation drive to provide relief to black money hoarders, then why can’t it be changed for political parties?
The way the PM has chickened out from cleansing political funding is the most brazen blow to the people suffering the pain of noteban.
The intent of the government is never bad. Even wars are fought ultimately for bringing in peace. The success of government policies is measured by their results.
Unfortunately, after 50 days of torment under the most radical reset India has seen, the nation is left with no clear roadmap to recovery, except a battered economy and timorous follow-up.