India News

Demonetisation hovers like a dark cloud

Published

9 years ago

January 31, 2017

[vc_row][vc_column][vc_column_text]Economic Survey points to the short-term costs which are visible and tangible

By Parsa Venkateshwar Rao Jr

In President Pranab Mukherjee’s address to the Joint Session of Parliament as the Budget Session kicked off on Tuesday, there was a passing reference to demonetisation, in Para 55, of the more-than-an-hour long and 80-paragraph speech. It seemed as though the government (the President’s address is written by the government) did not want to linger too long on the unpleasant fact of demonetisation.

But an hour after President Mukherjee’s speech and after Finance Minister Arun Jaitley laid the Economic Survey 2016-17 on the table of Lok Sabha, Chief Economic Advisor in the Ministry of Finance, Arvind Subramanian, took the floor at the National Media Centre, to explain to the media the salient points of the survey, which is the official assessment of the state of the economy of the year gone by.

The survey had to take the bulls by the horn as it were, and in this case the bull and its horns happen to be Prime Minister Narendra Modi’s November 8, 2016 announcement declaring that Rs 1,000 and Rs 500 notes will cease to be legal tender. Problems followed, and though the ordinary people bore with the acute inconvenience it had created which emboldened the Prime Minister to believe that the people will back his unpopular decision, the Economic Survey could not look away from the issue staring in the face of the economy.

While describing demonetisation in laudatory terms as “a radical governance-cum-social engineering measure”, and seeking to assess the short-term costs and long-term benefits of the move, the survey could not avoid noting that “the costs have nonetheless been real and significant” ; it also said, “The magnitudes of short-term costs remain uncertain, as do the timing and extent of long-term benefits.”

The survey also emphasises what needs to be done to cushion the hard-landing of demonetisation: “…remonetising the economy expeditiously by supplying as much cash as necessary, especially in lower denomination notes; and complementing demonetisation with more incentive-compatible actions such as bringing land and real estate into the GST, reducing taxes and stamp-duties, and ensuring that demonetisation does not lead to over-zealous tax administration.”

But then he places demonetisation as one of the many measures, including the passing of the GST Bill, the setting up of the Monetary Policy Committee (MPC) in the Reserve Bank of India to calibrate interest rates and to manage inflation, giving Aadhaar a legal basis by making the Unique Identification Authority of India (UIAI) a statutory body. The survey does not give demonetisation the status of a game-changer in itself.

In Chapter 3 of the survey, enticingly entitled “Demonetisation: To Deify or Demonise?” it offers a closer look at the decision. It says that “India’s demonetisation is unprecedented in international economic history” because “all other sudden demonetisations have occurred in the context of hyperinflation, wars, political upheavals, or other extreme circumstances. But the Indian economy had been growing at the fastest clip in the world on the back of stable macroeconomics and an impressive set of reforms. In such normal circumstances, demonetisations – such as the one announced recently in Europe – tend to be phased in gradually.”

And the survey tries to explain, if not explain away, demonetisation, in another way: “In the wake of the Global Financial Crisis (GFC), advanced economies have used monetary policy t stimulate growth, stretching its use to domains heretofore considered heretical such as negative interest rate policies and “helicopter drops” of money. In fact, India has given a whole new expression to unconventional monetary policy, with the difference that whereas advanced economies have focused on expanding money supply, India’s demonetisation has reduced it. This policy could be described as “reverse helicopter drop”, or perhaps more accurately a “helicopter hoover”.

It can be seen that the survey tries hard to understand and explain the inexplicable demonetisation move, and it has come to the hard conclusion that this would bring down the growth rate by one-fourth or one-half percentage points.[/vc_column_text][/vc_column][/vc_row]

Related Topics:APN Budget 2017 Demonetisation Economic Survey

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GRAP stage-III measures enforced across Delhi as air quality worsens

Delhi’s air quality has deteriorated further, prompting authorities to enforce GRAP stage-III measures across the NCR amid rising AQI levels.

Published

7 hours ago

January 16, 2026

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Delhi’s air quality has continued to deteriorate, prompting authorities to enforce Stage-III measures under the Graded Response Action Plan (GRAP) across the National Capital Region with immediate effect.

The Commission for Air Quality Management (CAQM) said the Air Quality Index (AQI) of the national capital showed a worsening trend over the past 24 hours. The AQI stood at 343 on January 15 at 4 pm and rose further to 354 by 4 pm on Thursday, raising concerns that pollution levels could soon enter the ‘Severe’ category.

Weather agencies have forecast unfavourable atmospheric conditions in the coming days, including low wind speeds, a stable atmosphere and poor dispersion of pollutants. Officials said these conditions could push Delhi’s average AQI beyond 400, which falls under the ‘Severe’ air quality bracket.

Stage-III restrictions come into force across NCR

In view of the rising pollution levels and the forecast of further deterioration, the CAQM sub-committee on GRAP decided to invoke all measures under Stage-III. These measures correspond to ‘Severe’ air quality levels and have been implemented as a precautionary step to prevent further decline.

The Stage-III actions will be enforced in addition to the restrictions already in place under Stages I and II of GRAP, which remain operational across the NCR. Officials said the combined measures aim to tighten controls on pollution sources, enhance monitoring and ensure stricter enforcement to curb emissions.

CAQM has directed pollution control boards and concerned agencies in the NCR to intensify preventive and regulatory steps. Authorities have been asked to ensure strict compliance with GRAP norms and take prompt action against violations.

Officials said air quality levels will be closely monitored, and further decisions will be taken based on real-time data and evolving weather conditions. Citizens have been urged to cooperate with advisories and follow measures aimed at reducing pollution levels.

India News

PM Modi to visit Bengal and Assam, launch Vande Bharat sleeper train and key projects

PM Modi will visit West Bengal and Assam on January 17 and 18 to launch India’s first Vande Bharat sleeper train and inaugurate major infrastructure projects.

Published

7 hours ago

January 16, 2026

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Prime Minister Narendra Modi will visit West Bengal and Assam on January 17 and 18, where he will flag off India’s first Vande Bharat sleeper train and inaugurate, dedicate and lay the foundation stone for a series of infrastructure and development projects across the two poll-bound states.

Vande Bharat sleeper train to be flagged off from Malda

On Saturday, the prime minister will visit Malda in West Bengal around 12.45 pm and flag off the country’s first Vande Bharat sleeper train connecting Howrah with Guwahati (Kamakhya) from the Malda town railway station.

Later in the day, around 1.45 pm, he will address a public programme in Malda where he will dedicate to the nation and lay the foundation stone of multiple rail and road projects worth more than Rs 3,250 crore.

Development projects in Hooghly district

On January 18, around 3 pm, the prime minister will visit Singur in Hooghly district, where he will inaugurate, lay the foundation stone and flag off various development projects worth around Rs 830 crore.

During the visit, Modi will also virtually flag off four new Amrit Bharat Express trains connecting New Jalpaiguri with Nagercoil and Tiruchirappalli, and Alipurduar with Bengaluru and Mumbai (Panvel). These services are aimed at improving affordable long-distance rail connectivity and strengthening inter-state economic and social linkages.

New train services and highway projects in north Bengal

The prime minister will flag off two new train services with LHB coaches — Radhikapur–SMVT Bengaluru Express and Balurghat–SMVT Bengaluru Express — providing direct connectivity from north Bengal to major IT and employment hubs.

He will also lay the foundation stone for the rehabilitation and four-laning of the Dhupguri–Falakata section of National Highway-31D, a project expected to significantly improve road connectivity and the movement of goods and passengers in the region.

Additionally, Modi will lay the foundation stone of four major railway projects in West Bengal, including a new rail line between Balurghat and Hili, next-generation freight maintenance facilities at New Jalpaiguri, upgradation of the Siliguri loco shed and modernisation of Vande Bharat train maintenance facilities in Jalpaiguri district.

He will also dedicate the electrification of the New Coochbehar–Bamanhat and New Coochbehar–Boxirhat rail sections, enabling cleaner and more energy-efficient train operations.

Cultural programme and Kaziranga corridor in Assam

On January 17, around 6 pm, the prime minister will attend the Bodo cultural programme “Bagurumba Dwhou 2026” at Sarusajai Stadium in Guwahati. More than 10,000 artists from across Assam are expected to perform the traditional Bagurumba dance in a single synchronised presentation.

On January 18, around 11 am, Modi will perform the bhoomi pujan for the Kaziranga elevated corridor project, valued at over Rs 6,950 crore, at Kaliabor in Nagaon district. The 86-km project includes a 35-km elevated wildlife corridor passing through Kaziranga National Park, along with bypasses and highway widening works aimed at improving connectivity while protecting biodiversity.

During the Assam programme, the prime minister will also flag off two new Amrit Bharat Express trains — Guwahati (Kamakhya)–Rohtak and Dibrugarh–Lucknow (Gomti Nagar) — strengthening rail connectivity between the northeast and northern India.

India News

NDA’s track record strikes chord as PM Modi hails Maharashtra civic polls win

Prime Minister Narendra Modi hailed Maharashtra voters after the BJP-led NDA registered a historic victory in the BMC elections, ending decades of Shiv Sena dominance.

Published

7 hours ago

January 16, 2026

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Prime Minister Narendra Modi on Friday thanked the people of Maharashtra after the BJP-led National Democratic Alliance registered a landmark victory in the Brihanmumbai Municipal Corporation elections, marking the first time the party has emerged on top in the country’s richest civic body.

In a post on X, the prime minister said the people of the state had endorsed the NDA’s agenda of governance and development. He said the results of municipal corporation elections across Maharashtra showed that the alliance’s bond with voters had further strengthened.

According to PM Modi, the NDA’s track record and vision for development had “struck a chord” with the electorate. He described the verdict as a mandate to accelerate progress while celebrating Maharashtra’s cultural legacy.

BJP-Shiv Sena alliance dominates BMC

As counting continued, trends showed the BJP leading in 90 of the 227 wards in Mumbai, while the Eknath Shinde-led Shiv Sena was ahead in 28 wards. The Ajit Pawar-led NCP faction, which contested separately, was leading in only three wards.

On the opposition side, the Shiv Sena (UBT) and Maharashtra Navnirman Sena were ahead in 57 and nine wards respectively. The Congress, which contested in alliance with the Vanchit Bahujan Aghadi, was leading in 15 wards, while others were ahead in eight.

The outcome effectively ends the Shiv Sena (UBT)’s decades-long control over the Brihanmumbai Municipal Corporation, which had been the party’s main power centre since its formation.

In the seat distribution, the BJP contested 137 wards and the Shinde-led Shiv Sena 90. The Ajit Pawar faction of the NCP fielded candidates in 94 wards. On the opposition side, Shiv Sena (UBT) contested 163 seats, the MNS 52, the Congress 143, and the Vanchit Bahujan Aghadi 46.

Urban verdict weakens Pawar influence

The results in Pune and Pimpri-Chinchwad also sent a strong political message, indicating that the Pawar brand no longer guarantees success in key urban centres. Despite tactical coordination between the two NCP factions led by Sharad Pawar and Ajit Pawar, voters did not consolidate behind them.

In the Pune Municipal Corporation, the BJP emerged with a clear upper hand, either winning or leading in a significant number of wards. The NCP factions failed to convert their traditional influence into broader citywide support.

Thackeray retains Marathi Manoos connect but loses power base

Uddhav Thackeray appears to have retained a section of the Marathi Manoos vote in Mumbai, even as the Shinde-led Shiv Sena made inroads. While the Shiv Sena (UBT) managed a respectable showing in its traditional strongholds, the loss of control over the BMC is seen as a major setback.

Control of the civic body had long been central to the party’s political identity and a key factor in its alliances.

Devendra Fadnavis emerges as key strategist

Much of the credit for the BJP’s sweeping civic success is being attributed to Devendra Fadnavis. Under his leadership, the Mahayuti alliance has carried forward its assembly election momentum into municipal politics.

The results are being seen as reinforcing Fadnavis’s political standing, demonstrating that even combined opposition forces could not halt the BJP’s rise. The verdict has also challenged the long-held claim of the Thackeray family over Marathi votes in Mumbai.