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Demonetisation hovers like a dark cloud

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Demonetisation hovers like a dark cloud

[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]

India News

Cockroach Janta Party gives CEC Gyanesh Kumar 48 hours to resign, warns of nationwide protests

Cockroach Janta Party founder Abhijeet Dipke has demanded the resignation of Chief Election Commissioner Gyanesh Kumar within 48 hours, warning of a nationwide agitation if the demand is not met.

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Cockroach Janta Party (CJP) founder Abhijeet Dipke has demanded that Chief Election Commissioner Gyanesh Kumar resign within 48 hours, warning that the organisation will launch a nationwide agitation if he does not step down.

The demand was made during a press conference on Thursday amid a wider controversy surrounding the Election Commission’s handling of electoral-roll-related matters and the ongoing Special Intensive Revision (SIR).

Dipke alleged that the functioning of the Election Commission under Kumar had raised concerns over the electoral process. These claims are allegations made by Dipke and should not be treated as established facts.

What did Abhijeet Dipke demand?

Dipke called for Gyanesh Kumar’s resignation within 48 hours. He warned that the CJP would begin a nationwide protest if the Chief Election Commissioner did not step down within the deadline.

The organisation said the proposed agitation would follow the lines of its earlier protest at Delhi’s Jantar Mantar.

The CJP also raised other demands related to the electoral process, including a halt to ongoing electoral exercises and the Special Intensive Revision of electoral rolls.

Why is CJP demanding Gyanesh Kumar’s resignation?

The demand comes amid a controversy over the Election Commission’s electoral-roll processes.

The demand came amid a controversy over the Election Commission’s handling of the Special Intensive Revision (SIR) of electoral rolls, following a report that Election Commissioners Sukhbir Singh Sandhu and Vivek Joshi had raised questions about the exercise. 

However, the Election Commission has rejected the suggestion that these differences represented a division within the three-member poll panel. The Commission said that differing views, written notes and internal checks are part of its deliberative process and maintained that decisions, including those concerning SIR, were taken unanimously.

What has Abhijeet Dipke alleged?

Dipke has alleged that more than 13 crore votes were deleted from electoral rolls and questioned the reasons behind the deletions.

He also alleged that voter deletions had affected Opposition leaders and referred to several political figures while making his claims.

These figures and allegations were presented by Dipke during the press conference. They should therefore be attributed to him rather than stated as independently verified facts.

Dipke also questioned whether the alleged deletions could affect the political balance in elections.

What happens if Gyanesh Kumar does not resign?

According to Dipke, the CJP will launch a nationwide agitation if the Chief Election Commissioner does not resign within 48 hours.

He said the organisation would continue its campaign until its demand for Kumar’s resignation was met.

The CJP has also announced a broader campaign against the Election Commission, while warning of further protests.

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India News

Rahul Gandhi attacks CEC Gyanesh Kumar, says vote chori leads to kanoon chori

Rahul Gandhi accused the Election Commission of failing to protect voters and linked his “vote chori” allegation to what he called “kanoon chori”.

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Congress leader and Leader of Opposition in the Lok Sabha Rahul Gandhi on Thursday launched a fresh attack on Chief Election Commissioner Gyanesh Kumar and the Narendra Modi government, alleging irregularities in India’s electoral process.

Addressing a press conference in Delhi, Mr Gandhi linked his earlier allegations of “vote chori” with what he described as “kanoon chori”, arguing that alleged manipulation of votes would have consequences for the country’s law-making and institutional systems.

“From vote chori comes kanoon chori,” Mr Gandhi said, arguing that if votes had been stolen, laws and institutional changes made by lawmakers elected through those votes would also be affected.

Rahul Gandhi attacks Gyanesh Kumar

Mr Gandhi specifically targeted Chief Election Commissioner Gyanesh Kumar and questioned the Election Commission’s handling of the electoral process.

His remarks came amid reports of differences within the poll body over the Special Intensive Revision (SIR) exercise. Mr Gandhi referred to reported concerns involving the Election Commission and alleged that questions raised about the functioning of the poll panel had not been adequately addressed.

He also alleged that the Election Commission had failed in its responsibility to protect the vote, which he described as the foundation of India’s democratic and constitutional system.

‘Vote chori’ claim

Mr Gandhi reiterated his allegations of irregularities in elections and said the issue went beyond individual voters.

He argued that the vote gives power to the Constitution, while the Constitution provides the basis for laws and institutions. On that basis, he said alleged destruction of the voting process would have wider consequences for the country’s constitutional system.

Mr Gandhi also questioned what he described as the disappearance of anti-incumbency in elections involving the BJP, comparing recent electoral outcomes with earlier political trends.

He alleged that the 2024 Lok Sabha and Assembly elections had been manipulated. These remain allegations made by Mr Gandhi and should not be presented as established facts.

Attack on Modi and Amit Shah

During the press conference, Mr Gandhi also targeted Prime Minister Narendra Modi and Union Home Minister Amit Shah while making his allegations about the electoral process.

He questioned the role of the Election Commission and its leadership, and called for accountability over what he described as irregularities affecting India’s voting system.

Mr Gandhi said he was presenting evidence for his allegations and maintained that the issue concerned not only elections but also the functioning of democratic institutions.

The Election Commission’s reported internal differences over the SIR exercise formed part of the backdrop to his remarks. The claims made by Mr Gandhi concern his interpretation of those developments and are distinct from established findings about election manipulation.

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India News

Ram Temple donation theft case chargesheet filed, trustees not named

A chargesheet has been filed in the Ram Temple donation-theft case in Ayodhya. The temple trust’s trustees have not been named as accused.

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A chargesheet has been filed in the case involving alleged theft of donations at the Ram Temple in Ayodhya. The chargesheet, however, does not name the trustees of the temple trust as accused.

The development comes after an investigation into several instances of alleged theft of donations at the temple complex. The probe had examined CCTV footage and other evidence related to the incidents.

Chargesheet filed in donation theft case

The chargesheet has been submitted against those accused in connection with the alleged theft of donations at the Ram Temple.

Importantly, the trustees of the Shri Ram Janmabhoomi Teerth Kshetra Trust have not been named as accused in the chargesheet.

The investigation had focused on incidents in which donations were allegedly stolen from the temple premises. CCTV footage was examined as part of the probe into the reported thefts.

Investigation into 105 theft incidents

An earlier investigation had identified 105 instances of alleged donation theft through CCTV footage. The probe examined the incidents and the people allegedly involved in them.

The case had also led to arrests of accused persons named in the FIR. The investigation subsequently examined the role of individuals connected with the incidents.

The filing of the chargesheet marks a further step in the criminal proceedings related to the alleged theft of donations at the Ram Temple.

Trustees not named as accused

The chargesheet does not name the temple trust’s trustees as accused. This distinction is significant because the filing concerns the individuals against whom the investigating agency has proceeded in the case.

The chargesheet will now form part of the legal proceedings, while the matter will be dealt with through the appropriate judicial process.

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