While it has been more than a month that the demonetisation announcement was made, the claws of demonetisation still grip majority of Indians with its massive implications. Till date, there are irreconcilable differences which exist in the opinions of people across the nation. For many, demonetisation is an ultra positive move which has been initiated in the direction of an ‘Ethical India’. Contrarily, many people are furious at Modi for having to stand in those serpentine queues for hours at a stretch to withdraw cash.
At a stroke, Modi scrapped money worth 15.4 trillion rupees ($220 billion), almost equal to 86 percent of cash in India, Asia’s third-largest economy.
Whilst the Prime Minister is being consistently criticised and pinned down by opposition and a fraction of general public, Modi had said, “I have done all the research and, if it fails, then I am to blame,” Modi told a cabinet meeting on Nov 8th, shortly before the announcement was made, according to three ministers who attended the meeting.
Hasmukh Adhia, a bureaucrat, among five others were privy to the plan had sworn to utmost secrecy, say reliable sources. They were accompanied by a young team of researchers working at Modi’s New Delhi residence, ever since 2014 when Modi came in power.
If officials are to be believed, he enjoys a sound reputation for integrity and discretion. Forthwith to the announcement, Adhia sent a tweet: “This is the biggest and the boldest step by the Government for containing black money.”
Over more than a year, Modi commissioned research from officials at the finance ministry, the central bank and think-tanks on how to build upon his actions to counter black money menace, an official said.
Questions such as: How quickly India could print new banknotes; how to distribute them; would state banks benefit if they received a rush of new deposits; and who would gain from demonetisation? -were intended to be answered.
Back in April, analysts at State Bank of India said that demonetisation of large-denomination notes was possible.
The Reserve Bank of India, the central bank, also disclosed in May that it was making preparations for a new series of banknotes that were confirmed in August when it announced it had approved a design for a new 2,000 rupee note.
So, in a nutshell things and developments were not happening in absolute isolation. There were enough hints to search out for, which could have indicated the government’s move to demonetize high-value notes. As they say,‘A sharp-witted person can comprehend a big move by connecting all the dots.’