The people of India elected Prime Minister Narendra Modi in 2014 with a thumping majority on the back of enormous expectations to transform India. The previous 10 years of the Congress-led UPA were marked by high decibel corruption scandals and a growing public outrage towards their mis-governance and apathy. Contrast this with the present Government which puts transparency and accountability at the centre of every action. This has reflected in the massive public trust and support for the Prime Minister and BJP in various elections across the country from the grassroots (Panchayat) to the highest (Parliament). The landslide victories in Uttar Pradesh and Uttarakhand, and stellar performances in Goa and Manipur are a clear vote in favour of the Prime Minister’s noble intentions, and demonstrate the massive support for demonetisation among the people of India.
Continuing the series of measures against black money and corruption, on 8th November, Prime Minister Modi took the most revolutionary step to take on the cancer of corruption, black money and terrorism that had struck at the very roots of our system. The people were willing to bear with the short-term inconvenience for the larger long term good of the nation.
What we saw was the manifestation of Janshakti - people’s participation in this national cause. They recognised that “sometimes the hardest thing and the right thing are the same”.
Demonetisation broke the backs of those who threatened national security and sent a clear message that it was no longer “business as usual”. Large deposits are under scrutiny to verify their authenticity. The past complaints of too little action against the corrupt high and mighty have been redressed. The honest feel comforted while the dishonest have lost out. One of the biggest gains was to people who wanted to live their lives honestly but were forced to operate in the shadow economy. Prime Minister Narendra Modi enabled them to join the mainstream without fear of undue scrutiny of the past under various tax and labour laws.
There are large benefits to the economy due to this shift from the informal to formal economy.
When any transaction was made in black money, it was not always accounted for in the GDP. However, as more and more transactions are made through banking and digital channels, taxes will be paid and income declared honestly. This will actually help the GDP grow, not contract as some of the naysayers suggest. Even GST could not have been a success in the old way of doing business given that money was flowing seamlessly from the formal to informal economy.
Antyodaya, serving the last man at the bottom of the pyramid, is at the core of our philosophy, which is inspired by our ideologue, Pandit Deen Dayal Upadhyaya, whose birth centenary we are celebrating this year. Increased tax revenue will help us serve the poor who have the first right on the nation’s resources. It will also help in reducing the taxation burden on the honest as seen in the latest budget, where tax rates were reduced.
Unorganised labour which is estimated to be 92% of our total workforce will be a big beneficiary. It is well known that most of them do not get minimum wages, health care under ESIC or pension through provident fund because their wages are paid in cash and their employment not recorded. Formalisation and electronic means of payment will help provide a life of dignity and security to workers and they will at leastget their due minimum wages, which were recently increased by 42% for all sectors, in addition to health care, security, and old age benefits. This is something which was not achieved in the last 70 years.Finally, even the tea garden workers in Assam, milk suppliers in Gujarat and textile workers in Tamil Nadu are being paid through the bank, formalising their engagement in the system.
High interest rates had made credit unaffordablefor Micro, Small and Medium Enterprises - the sector that provides livelihood to large sections of our society. Due to the inflow of low cost Current Account/ Savings Account (CASA) deposits, the average cost of funds reduced drastically, enabling banks to reduce lending rates by unto 1% recently. This will give a fillip to investments and create income and employment opportunities in the economy. In addition, interest subvention on housing loans, announced by the Prime Minister on 31st December, at the end of the demonetisation period, will make homes even more affordable, bringing them within reach of the common man.
To top it all, latest GDP growth number at 7%, shows that India continues to be the fastest growing large economy in the world.
Mostsectors are showing robust growth. Farmers, who are the backbone of our country are benefiting immensely from such rapid growth. This has belied the fears of many who claimed that the agricultural sector would be the worst affected from demonetisation. Inflation too has declined to 3.17%, the lowest in many years.
However, turning a blind eye to what was always evident, some “experts” and economists attacked our Government. They made doomsday predictions and tried to spread panic and confusion amongst the public and investors. Sadly, personal prejudices seemed to prevail, as seen in the unjustified comments by Prof. Amartya Sen.Hecalled demonetisation a “despotic decision” and warned of “adverse consequences”; both comments which have been summarily rejected by the people of India as evidenced in the series of electoral victories of the BJP led by Prime Minister Narendra Modi since November 8th across affluent parts of Maharashtra like Mumbai, Gujarat, Chandigarh, Faridabad or the under developed regions of Odisha. The guiding principal of our Government of “SabkaSaath, SabkaVikas” has been accepted across the country. This only goes to show that even a Nobel prize is not necessarily a certificate that whatever one says or does is right.
Going further, demonetisation will give birth to a more modern, digital and honest economy.
The very successful BHIM payments app, launched recently by Prime Minister Modi, reflects the digital push of this Government through the trinity of Jan Dhan - Aadhaar - Mobile (JAM), which will help in reducing dependence on cash in the long run.
When the then Prime Minister Shrimati Indira Gandhi was submitted a proposal suggesting demonetisation, she dismissed the idea saying, “Are no more elections to be fought by the Congress party?” In stark contrast, is our philosophy of ‘Dal se bada desh’ (Nation above party).
To conclude, demonetisation will lead to the economic development of India and prosperity for its people. It will result in higher GDP, transparency and integrity in the system, provide security to labour, jobs for the youth, cheaper loans to promote entrepreneurship and innovation, support farmers to double their income, provide affordable housing for all and higher revenues to the Government which can spend it on the poor and marginalized sections of society. Most importantly, it has brought a smile on the face of every honest Indian.
Demonetisation places national interest above all.
(Piyush Goyal is the Minister of State with Independent Charge for Power, Coal, New and Renewable Energy and Mines in the Government of India. He is currently a Member of Parliament (Rajya Sabha) and was earlier the National Treasurer of the Bharatiya Janata Party (BJP).)
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