DeMonetisation

“JUST” learning to live during the pandemic!

Vijay Yadav* is a small time vegetable and fruit vendor who has been carrying out his business in Mumbai since 2 decades now.  Ever since the lock down, in our apartment complex, he is one of the suppliers of fresh vegetables and fruits. Twice a week, we place order over WhatsApp to him and he delivers the same at the parking lot of our building. He informs us the due amount on WhatsApp and we pay the amount due to him through Google Pay.

22nd Aug, 2020 was Ganesh Chaturthi. Due to the current pandemic situation, we couldn’t go to the local market for Pooja related shopping (different types of Flowers, Garland…) on the eve of the festival. When we were wondering what to do, Meena*, our regular flower seller informed us to our pleasant surprise that she will home deliver whatever flowers and items we need and asked my wife to send the list over WhatsApp. On the 21st evening, the list was delivered at our ground floor. She informed us the amount and we made the payment to her through PayTM.

On 22nd Aug was also our Avani Avittam (Janeu changing ceremony) for which our regular Cheenu vaadhyar (bhatji) sent us the YouTube link to join him. From home, we completed the rituals and promptly sent the Acharya sambavana thro Google Pay.

In between we had to consult for a routine ailment with our Homeopath doctor.  We did the same over phone. He said he will send the medicines to our house within 1 hour. He has a tie up with Swiggy and the medicines were delivered at our doorstep. The doctor gave his UPI id for transferring his fees, which we did.

What is common in all these? It is that we and the other parties involved were able to carry on with life even during the lock down period without stepping out of our place, fairly smoothly. And if you look at it closely, this was made possible through a combination of Smart phones, Bank accounts (to which we could transfer the money) and more importantly the UPI platform through which we could transfer money real time into bank accounts of beneficiaries.

It was Dr. Arvind Subramanian, Ex-Chief Economic Advisor to the Government of India who in his 1st Economic Survey document coined the term – “The JAM Trinity” and said that the potential of Jan Dhan Yojana, Aadhaar and Mobile phone could be harnessed to plug subsidy leaks and ensure a more targeted delivery to those needy.  This was the beginning of Modi’s 1st term during which, the government gave a huge push to opening Bank accounts for the poor through the Jan Dhan Yojana and also advocated the use of Aadhaar for identifying the needy.  However, in the aftermath of Covid-19, I would tweak the JAM Trinity and say that it is the “Quad of JUST” which is helping to keep the bottom of the pyramid afloat during the pandemic.

If you look at the examples I have provided at the beginning, you would realise that even with the unexpected strike of the pandemic, what has been sustaining at least some fraction of the economic activity is a combination of

J (Jan Dhan Accounts) – through which we could transfer money to beneficiaries who are not so privileged like Domestic helps, small time vendors and so on.

U (UPI Platform) – without which money transfer to bank accounts through mobile wallets like Google Pay or PayTM for example, couldn’t be so easy and swift.

S (Spectrum) – as in the advent of 4G which has made data usage cheap and ubiquitous in India

T (Technology) – Without which all these would not have been possible at all.

In this four, I would like to focus on the UPI bit. United Payment Interface (UPI) developed by National Payments Corporation of India was launched in India in April 2016. But it was post the Demonetisation that UPI as a tool got its fillip in terms of adoption and usage. Just look at the numbers. From just 21 banks who were part of UPI in 2016 when it was launched, today it is more than 140. The transaction volumes have grown exponentially from 2.06 mn. in Dec 2016 to 1.49 bn. in July 2020. And in terms of revenue, it has gone up from Rs. 13.17 crore to Rs. 29.05 Lac crore in the same period!!

It’s been so much of a runaway success that Google (which is part of the UPI through its GPay product) has written to US Federal Reserve Board urging it to build a similar faster payment service platform in the US citing the case study of UPI.

As documented very well by Shankkar Aiyar in his book, The Accidental India, in post Independent India, almost all of the successful economic transformations happened as an answer to a crisis. Similarly, the success of UPI in India also, could be pointed towards the cash payment crisis situation that resulted due to Demonetisation in November 2016. While Demonetisation might not have yielded the originally intended objective of the government namely to suck out the black money from the system, I feel that it has delivered or still delivering other positive outcomes.

Among the top is the formalisation of the economy which is a Work in Progress. The huge success of UPI has made conducting business smoother and easier even during lock down times even for the micro business community. At the same time, the added benefit is the expansion of the formal economy where less and less transactions happen through cash.

The last few months ever since the pandemic struck, have been testing times for any country and its economy.  It’s my feeling that after the initial complete lock down phase of two months, Indians have accepted the reality and have started looking at ways and means of getting on with their lives even without any dole from the government in the form of cash support. Purely from the stand point of micro businesses, they have all tried to adapt their business models to at least survive and stay afloat. Accepting orders through WhatsApp, doing home delivery and equipping themselves with online payment options are some of these adaptations. And these may very well stay even after the pandemic is over. In that sense, while the media commentary (when not busy with Sushant Singh’s death that is) could be around doom and gloom due to Covid in India, the common man has learnt to live during the pandemic with the “Quad of JUST” and will to survive.

Postscript: Way back in November 2016, in the aftermath of Demonetisation I had written a post titled Cash Mukt Bharat (Read here) where I had fantasised of an India where cash transactions have reduced completely by 2025. We are in 2020. Looks like many things mentioned in that post have already become a reality.  Amen.

*All names changed.

Pic courtesy: Yourstory.com

In #2019, no TINA but be wary of TAIL!

As 2018 winds down and we step in to 2019, for India, it is just not another new year. Mid of 2019 is when we will have the Lok Sabha polls that will determine if Narendra Modi will get another shot at being the Prime Minister. In my memory, I cannot recall of any individual who has come for so much scrutiny as an elected representative. And whose re-election is being discussed and debated so intensely in the country. First up, blame it all on the social media and its growing tentacles!

The fact that a government’s performance is coming up for such a rigorous appraisal itself, augurs well for our country. It should be like that. I only hope that this appraisal business isn’t selective and not just reserved for Modi Sarkar! If I think as to why this government has come under such a close assessment, I realise that it should blame itself for the same.

Did we have any other government in the past that

Set targets for itself on many fronts?

Which announced the targets and put them out in public domain?

Which tracked the actual delivery against the targets and presented them for everyone to see and comprehend easily that too mostly on real-time basis?

Today we know, not just what this government’s targets are for rural electrification, construction of highways, building targets, opening of bank accounts so on and so forth but also where it stands in terms of achievement. One look at the https://transformingindia.mygov.in/performance-dashboard/ site gives us an update on a real-time basis. It is not that governments in the past did not set targets for themselves. But all these targets were usually in terms of outlays announced in the Annual Budget speeches and seldom one would know what the final outcomes were. Between the outlays and outcomes, the India story remained in tatters. I guess not any more.  So, if people keep remembering the promises made and get disappointed if some of the promises have not been met fully or adequately, blame it on the Government’s efforts of putting out data in the open which makes it possible to compare achievements Vs goals easily.

In comparison to the upbeat mood in 2014 and 2015, today the mood in the country is more sombre. Even the most loyal fans of Modi have realised that probably he chewed more than what he could swallow. Five years are just not enough to turn around and solve all the ills of the country. That too when the global economy is facing one headwind after another! But then, as a country we had our own share of misses. Right when the economy was getting back on track in 2015/16 from the throes of policy paralysis and negative vibes and was poised for a leap, this government let loose the Demonetisation devil on the economy.  This set the economy back by 2 years to get back on track. That we didn’t fully collapse and managed to grow the economy at a slower pace nevertheless, would be a miracle, academicians would pore over in the years to come!

Before the effects of Demonetisation could subside, this government went ahead with the introduction of GST which according me is the biggest Tax reform in Independent India. Irrespective of the critics who take on this government on the “not so perfect” GST, I maintain that it was extremely creditable on the part of Modi Sarkar to launch the GST without further delaying, on the 1st of July 2017. In India, in aspects of meeting deadlines, we Indians follow religiously and rigorously the Theory of Elasticity which says solid materials deform under the application of external force and regain their original shape when the force is removed. So, in the quest of a perfect, ideal GST, if this government had deferred the launch, who knows, perhaps we will still be talking of “introducing the GST” in the upcoming budget!  Against that, today we already have a thriving GST which is now going to complete 2 years! The introduction of GST will remain this government’s biggest achievement when its history is written.

The short term pains inflicted by these 2 moves (Demonetisation and GST) to the small and medium businesses combined with the government’s failure to address the Banking crisis at the beginning of its term have led the BJP to the situation where it is today.  In its strong hold states like Gujarat, Madhya Pradesh, Chhattisgarh and Rajasthan, the party’s support base has been dwindling. On the contrary, the Congress which seemingly had no hope of a revival till mid-2017, has smelt blood and is hoping to deprive Modi of a second term and a shot at history.

In India today, in the main stream media and also probably social media, the obituary of Modi Sarkar is being written on a daily basis. As per me, it is too early to write off Narendra Modi in the context of 2019. In spite of his government’s misses in terms of promises and more importantly the delivery of Achhe Din, his personal credibility as a leader who is keen to deliver, is intact. I do believe that there are those who are disappointed with him. But they are still not disgusted with him. Yet.  My personal feeling is that they would like to give him another chance.  The same states which voted out the BJP recently could very well see voting for Modi in the Lok Sabha polls!

Apart from this factor of Modi’s personal charisma, there is another important factor at play. People like to call it the TINA (There Is No Alternative) factor. I don’t believe that there are no alternatives to Modi. In fact, we have many. We have the spectre of a Rahul Gandhi becoming the Prime Minister, if a Congress led UPA front emerges as the biggest. Or else it could be toss between a Mamata Banerjee or a Mayawati or a Chandrasekhar Rao or any other leader depending upon how many seats they win, as part of a coalition which will be cobbled together post the elections. In all these cases, a leader of the party with 30-40 MPs would head the coalition of 10-15 parties with each party playing the “I am indispensable” card!

This Mahagathbandan where, parties will oppose each other in one state but will come together in another state is only a Maha”cut”bandhan who want their share of power and the perks that come with it. I believe that people are smart enough to understand and realise that Modi Sarkar might have disappointed but will still probably vote for him not because of TINA but being weary of TAIL – The Alternative Is Lousy!

In the past, we saw many Accidental Prime Ministers as we didn’t sight TAIL properly! Hope 2019 is different. On that hopeful note, wishing India a momentous 2019!

Cartoon courtesy: Satish Acharya

Demonetisation and it’s after”math”!!!

Ever since the RBI released its Annual report 2 weeks ago, Demonitisation (DeMo) is back in the news. And with its eminent Ex-Governor Raghuram Rajan now in India to promote his book, DeMo continues to hog the headlines and Op-Ed pages. The analysis of DeMo swing from scathing criticism of being a “big mistake” by the likes of Ex-Economic Advisor Kaushik Basu to calling it a “huge success and a course correction” by the likes of Gurumurthy, the veteran commentator on public affairs. So, as it happens in most issues these days, “for every spin there is an equally effective and opposite counter spin”! And where you stand on an issue depends on where you stand on the ideological divide.  On social media, it was a hashtag war between #DeMomenisationsuccess and #DeMonetisationfailure!

Ten months on, based on all the data available (99% of DeMo notes coming back to the banks) it seems that DeMo has not helped in sucking out the black money. In retrospection, I wonder how the government expected anybody in India to give up their prized possession (currency notes in this context) at all in the first place. In my own experience, when coming out with marketing promotion programs for the trade, we usually take twice the time for foolproofing the program compared to conceiving the program itself. This is from the wisdom of previous programs over the years where, we found that the Indian brain works over time always to find loop holes/gaps in any program announced. So, in a sales promotion program for example the trade will end up earning the incentives while you never achieve the increased sales objectives!

This is what happened in DeMo as well. If you remember, the day DeMo was announced, the chattering class’ verdict on WhatsApp group and dining area discussions was that it was a “Master stroke”! While the middle class and upper middle class folks who didn’t have unaccounted cash had to just find ways of beating the lines to exchange their notes, the ones who had, started cranking their brains. The result was the everyday tweaking of the rules and adding more terms and conditions for currency conversion. The then Economic Affairs Secretary Saktikanda Das became a celebrity overnight, thanks to his daily media briefings on what else – change in rules!

By now, it is clear that notwithstanding the anti-DeMo commentary of economists, there was overarching, tacit support for the DeMo move from common public. Inspite of loss of business for traders, loss of jobs for casual workers and loss of income for farmers the Note Bandi didn’t evoke much unfavourable mood towards the BJP so far. I am not sure if it will, from now on. What explains this paradox?

Many of the commentators have alluded to the human trait of Schadenfreude to explain this. That the poor were happy because this was one move which affected the rich and privileged and that the Prime Minister Modi had the guts to do so. This is a good possibility. But there could be more to this as well.  Within days of the DeMo announcement, the initial despair among people who were caught unawares with a lot of unaccounted cash turned into a relief, when they found ways and means to deposit the same into the bank. Among many ingenious ways, one was to tap into their own staff and workers to distribute the cash and get them deposited into their bank accounts. A report said that by Dec, the deposits in Jan Dhan Accounts peaked to Rs.74,609 crore! As of Sep, it was just 4,273 crore! The number of Jan Dhan accounts itself went up 5 times in this period!  My guess is that, in this process of conversion through the conduit of using others’ accounts, there must have been a cost.  The government must have lost an opportunity to earn taxes on the unaccounted income but those who had a lot of unaccounted cash ended up incurring a “conversion tax”! And I am certain that those who were witness to the rich incurring this tax felt certainly happy that DeMo was an equalizer of sorts. And not just being a witness, there would have been many who would have benefited from the sudden largesse of their masters as well and got their share of the “conversion tax”. So, instead of the government collecting taxes from the haves and distributing to have-nots by way of welfare measures did DeMo make it as a Direct Benefit transfer from the rich to the poor without the government in between?  Probably.

It’s evident now that the DeMo move has been a rocking political success for the government. On the economic front, though the objective of sucking up the black money has not been achieved directly, certain fringe benefits have accrued. Like reduction in cash circulation, increase in Digital transactions, and increase in bank deposits,…  These may leave the country in good stead in the future.  In the short-term however, the country skipped its GDP beat.

So when one does the after”math” of DeMo, it may well be like the popular “Elephant and the Blind men” story. For some, it’s a failure. For some, it’s a success. For some, it’s a partial success and for some it could be a partial failure. I would like to go with Rajan’s assessment that the short-term economic losses far outweighed the long-term benefits.  In hindsight, one is always wise. Other times – otherwise!

2016, History & Hope!!!

This time of the year, the last week is usually a “feel good” week. There is celebratory mood around thanks to Christmas, holiday outings to look forward to and with a fresh New year coming up – a feeling of Hope. Had the year gone well, one is anyway happy and hopes that the good days continue into the New Year. If it had not, you want to quickly move on and again hope that the New Year brings some cheer. Was it Ghalib who said – ‘Umeed par Duniya Kayam hai…uska saath na chodo’ (Hope sustains this world, don’t lose its company!) So it is with fervent hope for Achhe Din (oops not the political type) that one usually steps into the New Year – year after year!

While there are 12 months, 52 weeks and 365 days to a year, when history is written a year is usually defined by what happened in a week or probably in a day.  And seldom have we realised when an event unfolds that it is history in the making. That is left to the wisdom of hindsight. For example, we now know that 1991 has been an important year for India. For opening up of the economy. For the end of license Raj. For unshackling the animal spirits. Yet, when the Industrial policy announcement was made in July 1991 by the Government, they were acknowledged by and large only as important “course corrections” considering the state of the economy by the media.  Then, they were not labeled historic.  The “Reforms” were always treated with suspicion and even in the Congress party there were many a doubting Thomases who derided the then Prime Minister Narasimha Rao and the Finance Minister Manmohan Singh. But today the rearview mirror displays that the reforms of 1991 have indeed left a positive trail in our country.

History is a great leveler. And at times more charitable than the present. So you find more eulogies on Narasimha Rao as a visionary, as a modern Day Chanakya,..,..  today than there were when he was alive. Or even when he passed away in the same month around the same date in 2004. Hence I was not surprised when Manmohan Singh in his last press conference as a Prime Minister famously said – “History will be kinder to me than the contemporary media!!!”

So likewise when history is written I do believe that 2016 will have a significant place in it for the one event which happened on the 8th of November – The Demonetisation of high value currency notes! We will know how the after effects of this move play out in the next few quarters. As I mentioned we live in eternal hope. So the hope is that we get over the pain caused by this move sooner than later and the economy is back in track by March/April.

But apart from this, if there is one thing for which this move will be remembered for in history, it will be for how Demonetisation changed some steadfast habits of Indians. As author Shankkar Aiyyar famously said in his book – Accidental India that almost all of India’s turning points like the White revolution, Liberalisation,…) were not the result of foresight or careful planning but were rather the accidental consequences of major crises that had to be resolved at any cost.  Similarly the cash shortage situation resulting out of the Demonetisation program in the initial few days was panning out to be a major crisis. (Some would say it is still, though I beg to differ looking at how ground situation has changed for the better) This made the buyers and more importantly the sellers think of carrying on with their businesses with no or less cash.

Today in a traditional market in Mumbai – the usual signboard which said “Credit Card and other cards not accepted” – has the word “Not” blackened out! Paan Walas sporting “PayTM Accepted here” is no more just a subject of WhatsApp jeers but a reality. Restaurants and other outlets no more scorn at you if you flash your credit card for small payments. At multiplexes, there was are big lines during the interval not for buying popcorn tubs, but for swiping cards in one solitary POS machine! Personally speaking I am left with more cash in hand than ever in the past few years! The expenses haven’t reduced mind you though I would have lived with that side effect!

So this change in behavior of using less cash and migrating to digital means seen in Metros and big cities which will also spread to small towns and villages in due course could again become one “accidental” after effect of Demonetisation. We all know the overarching benefits of a Cash less /Digital economy. Indians by nature are trained to be less transparent in terms of disclosures – in matters of income and expenses. If we are forced to shrug off this ingrained reticence and have now become more open to transparency (all digital payments leave a trail) I think it is one helluva big step for a country like India naysayers notwithstanding.

2016 has been a historic year when status quo has been demolished everywhere. Brexit, the ascent of Donald Trump and in India – the Demonetisation move. The underlying sentiment has of course been “HOPE” in all these of better times ahead.  With the ushering of another New Year, there is continued Hope. For, Hope is not just a good thing but is the “Best” thing! And isn’t it increasingly perilous to lose its company?

hope1

“Hoping” you will continue to read my posts and provide valuable feedback – see you in the next year!

blogadda

Savour the Achhe Din!!!

In these largely agonizing days in India, a call to savour the Achhe Din would seem highly preposterous, isn’t it??? Well, wait a minute!

  • New Delhi, Oct 1984 – The then Prime Minister Indira Gandhi is assassinated by 2 of her own body guards. Over the next few days, thousands of Sikhs get killed and their property burnt in Delhi in a violent reaction.
  • Chennai, Dec 1987 – M.G.Ramachandran, the charismatic actor turned Chief Minister of Tamil Nadu died after prolonged illness at his residence. His death sparked off a frenzy of looting and rioting all over the state. Shops, cinemas, buses and other public and private property became the target of violence.
  • New Delhi & Parts of North India, Aug 1990 – The then V. P. Singh Government decides to accept Mandal commission report which recommended 27% reservation for OBC candidates at all levels of Govt. services. Large scale protests erupted mainly in North India including self-immolation bids by students against co-opting the report.
  • Mumbai, Jan 1993 – Following the Babri demolition in Dec, 1992, what started as peaceful protests escalated into large scale communal riots in Mumbai between Dec 1992 and Jan 1993 where thousands of people died, properties looted and destroyed.
  • Thane, Mumbai, April 2001 – Shiv Sena Leader Anand Dighe dies in Singhania Hospital, Thane at a relatively young age of 50 following a cardiac arrest. As soon as the news of Dighe’s death broke, irate Shiv Sainiks went on a rampage in the premises of Singhania Hospital and set on fire the hospital.
  • Bengaluru, Sep 2016 – Supreme Court orders Karnataka to release of 15000 Cusecs of Cauvery water to Tamil Nadu. Immediate violent reactions erupted with burning of TN registered vehicles and destruction of public and private property.

In all the above, one can notice that while the provocations are different – from a leader’s killing to another leader’s own demise to a political move to demolition of a religious symbol to an adverse Supreme Court judgement that too in different parts of the country, the reaction of the people followed a pattern. Violence, looting, mob fury, vandalism,…,…. leading to many deaths and large scale destruction of property.

This proves that as Indians we are a bunch of gullible emotional people. We can get easily provoked into carrying out what are supposedly unlawful activities that bring disrepute to the country and also affect us economically.

In any country’s timeline there are defining moments. Moments which change the destiny of the country for the good or worse. Our country’s history since Independence also is replete with such defining moments – some of them which we can be proud of and others which push our heads down.

I reckon that the Demonetisation call of 8th Nov, 2016 would be such a defining moment in our country’s history when it’s scripted later. I am not here to pronounce this based on the economic benefits of Demonetisation. The erudite are already doing it with media abound with pieces hailing and trashing the move in same breath. And frankly it is early days yet. However something else that is monumental is happening in the country which is what this post is on.

Going back to what I elucidated in the beginning of the piece, in our country we get easily provoked. And the result of the same is there for all of us to see. In this context let’s look at what’s been happening since that eventful address to the nation of the Prime Minister Narendra Modi on 8th November:

  • Bulk of currency in circulation was withdrawn and we were told to go Banks/Post offices to withdraw/exchange the old currencies before Dec. 30th
  • Since then there has been serpentine lines in front of banks.
  • Banks have been woefully short of currency as RBI’s supply chain right from printing to distribution has not been able to cope up.
  • Banks when they had currency only dispersed high value 2000 rupee notes.
  • ATMs have not been mostly functioning and if working for few hours, could give us just 1 note of Rs.2000.
  • The rules of withdrawal and exchange have been changing by the hour and have been the butt of new WhatsApp jokes by the minute! In fact the exchange goal post of 30th Dec. has been brought forward.
  • Both the TV and print media have myriad stories of how Demonetisation has affected the common man in urban and rural areas.
  • There have been many deaths attributed to Demonetisation in many parts of the country. Every day there are updates on the death toll in the media.

demon-toon

It’s almost a month now and still the situation is fluid. As one can see that this Demonetisation gamble by the Govt. has presented to us – public many, many opportunities to get provoked.  But the one difference is we that have not got provoked. At least up until now. And I hope I have not spoken too soon.

The resultant emotional outbursts leading to violent reactions for events mentioned in the beginning are sometimes quite spontaneous (though it is still difficult to explain the reactions so very violent) but many times orchestrated to further political interests. In this case (Demonetisation) also we have seen few political parties trying their best to spin things out of control and bring the Govt. on its knees. But just that this time around, few things have been different:

  • The common public of all hue – have not taken to damaging of banks, burning of empty ATMs, attacking Bank officers, setting on fire currency vans,… even when they have been driven to heights of frustration.
  • There have not been blackening of faces of BJP leaders or burning of effigies of PM or the RBI Governor!
  • For the 1st time in my memory, political parties had to go a large length to explain that they were not supporting any Bharat Bandh supposedly after reading the citizens’ Anti bandh mood!
  • For the 1st time again in my memory, no political party has given the Demonetisation move a communal colour so far. Otherwise in our country any decision from awarding a Padma Shri to constructing a hospital is given a communal tint by commentators and vested interests very convincingly.

For the above reasons I would like to believe that the benefits or otherwise of Demonetisation notwithstanding, this move will emerge as a defining moment in India’s history – where the public of India completely toed the line of its Prime Minister, shunned the rhetoric of others, remained unprovoked and went through the grind.

I am not sure if we as a country will display such great maturity in reacting to unfavourable events in the future. But for now, let’s savour the Achhe Din!!! Shoba De in her today’s column calls 2016 – Annus horibilis! No, Ms. De – for this significant change in our public reaction, 2016 is in fact Annus mirabilis!!!

Toon Courtesy: Satish Acharya

Also read my other post on Demonetisation – “Cash Mukt Bharat” here!

Cash Mukt Bharat!!!

  • The neigbourhood vegetable bhaiyya Yadavji is still going strong negating all predictions that the organized retail will swallow the likes of him. Organised retail didn’t quite swallow him. But he is now a fringe player of that organized retail. I pick up the weekly need of vegetables and fruits. His son who is in his early twenties, quickly totals up the bill in a handheld POS (Point of sale) device and lets me know the amount. He then sends me a request for the payment using his UPI (Unified Payments Interface) App on his smart phone. I approve the same and the payment gets credited to his account.

  • Adi Ganesh Store which was a popular shop in our neighbourhood In Mumbai catering to the typical needs of the South Indians (Read as Filter Coffee powder) is now Adi Ganesh Super market. They now accept payments in credit cards even for purchases under Rs. 100.

  • At the Guruvayurappan Temple nearby, the Hundis for coins and cash have been replaced by plastic card swiping machines where all donations can be made and receipts received.

  • Our family physician Dr. Purab is still the smiling self and fit as ever. He continues to give his own medicines but one can pay his fees through credit card.

  • The “Old paperwala on call” still comes promptly to collect the old newspapers. He now has a tie up with the Big Bazaar chain of stores and gives Big Bazaar cash cards for the paper taken.

  • Almost all auto rickshaws are now part of some aggregator or other and are accepting payments through mobile wallets.

  • The Domestic help handed over a card which had the details of her bank account number to which she requested the salary be transferred.

  • It looked like that the benefits of JAM (Jan Dhan Yojana/Aadhar/Mobile phone) which had threatened to be just a great theory has become a reality.

I realized that India in Jan 2025 is not the same in more ways than one as it was in 2017 when I left for abroad.  But I am surprised first, impressed next and fascinated finally by the transformation of a country in the area of financial inclusion and the transition to almost a Cash Mukt Bharat in just 8 years!

Almost everybody I talked to credited this transformation to various moves the present BJP Government undertook and in particular the “Demonetisation” of 500 and 1000 Rupee currencies in 2016. I remember that time very well. It was in November of 2016 when the country had just finished its annual quota of bursting crackers for Diwali. On 8th night, it was the turn of the Prime Minister to set off his Diwali bomb. At the stroke of midnight 500 and 1000 Rupee notes lost their legal tender. What followed in the next couple of weeks I now realize had sown the seeds for India almost becoming a Cash Mukt Bharat.

currency

With almost no cash in hand available, the general public had to resort to ways and means to avoid using their left over legal tender and use them only sparingly. People started doing day today shopping of veggies/fruits,.. in super markets instead of the neighbourhood vendor though he sold stuff fresh.  People avoided auto rides by hailing on the roads and resorted to “Ola Autos/Ola Cabs” where they could pay by mobile wallets. Within few days as banks resembled Ration shops of the 80’s India with serpentine lines right from sunrise, vegetable and other vendors started accepting cheques for payment in fear of losing their customers.  Most food establishments who had a minimum limit for accepting credit cards removed such limits. In the hinterland of India is where the impact was colossal. Though a big population was banked under Jan Dhan Yojana, till then they were not banking. The overnight shortage of currency, helplessness in otherwise carrying out day to today lives and finally the threat of losing business permanently pushed many to figure out alternate ways for making and accepting payments and they did. There was utter chaos for few days as the country came to terms with the move but ultimately in the long run, change did happen. In India normally change is slow. But under duress change is swift.

“Can you get up now?” It’s the wife at home waking me up from my nice Sunday afternoon siesta.  “I told you to think of a topic to write for the daughter for tomorrow’s Children’s Day event. Did you think of something??” I had not. But muttered as usual, “Yes”. What’s the topic on?? She asked. And I answered, “My dream India @ 2025!!!”