This month’s payday saw an unprecedented situation, with many unable to draw their full salaries or pensions. Banks ran out of cash even though the RBI had repeatedly said the system was geared up to meet the extra demand. While the finance minister says printing of new Rs 500 notes is on round the clock, the reality is that several banks were unable to pay even the permitted withdrawal of Rs 24,000 per week as they didn’t have cash. There was chaos as the long queues were full of people fast running out of patience. One can imagine the impact on households whose expenses, say for seven members, is over Rs 30,000 a week. There are harrowing tales of suffering where people in villages don’t have money even for funerals. And unlike in cities, banks in rural areas are at great distances from each other.
The rural crisis is becoming grimmer. Farmers see prices of their produce, from the kharif crop that’s yet to be harvested, falling, while traders can’t buy their produce for lack of cash. Even if farmers were paid by cheque, they can only withdraw upto Rs 25,000 a week. Many saw their perishable commodities rot. Vegetable and fruit prices crashed, but this wasn’t passed on to consumers, but pocketed by traders. If this situation isn’t rectified, there may be chaos with the rabi crop, as sowing hasn’t started. The plight of farm labour is even more distressing as their employers have no cash to pay them.
All this pain and suffering being faced by people is, we are told, for some nirvana of benefits in future. Will it really bring down bribery and corruption? Will demands for dowry and capitation fees really be a thing of the past? In case of dowry, for instance, demands are made for gold and white goods, and not necessarily cash. Real estate prices have come down, but many say this is temporary. It is said, for instance, that the new Rs 2,000 note will make bribery easier. One will just have to wait and see. The benefits of the demonetisation exercise seem rather nebulous as of now, because unless the channels for black money’s creation are plugged, another exercise will be necessary in the near future. The Prime Minister’s intention, of making India a better place for future generations, may be noble, but surely there were less painful ways of achieving this.
