Economic Effect of Demonetisation in India

Demonetization has been a disaster for the Indian economy. The Prime Minister has not done enough homework before taking that decision. 84% of Indian currency is in form of ₹500 and ₹1000 denomination. While it was announced on 8th November 2016 that the currency notes of the above mentioned denomination will no longer be valid. The government was not ready with new ₹500 and ₹2000 notes. They were not yet printed.

The result was huge ques outside banks and ATMs with all banks and ATMs running out of cash. Again the limit to which the money can be withdrawn per day was kept minuscule so people were made to go to banks and ATMs more frequently than they ever did. There have been over 70 deaths across the country till now when people died for not being able to exchange their money when they were in dire need of it. 

It has been 17 days till demonetization took effect but things are at the moment far from normal. Consumption has come down and this has lead to decline in business. Most businesses across the nation are badly affected. 70% of trucks are off the road, decrease in consumption has had a severe effect on the transport sector.

A CMIE (Centre for Monitoring of Indian Economy) report has mentioned that Indian economy is poised to lose ₹128,000 crore in the the 50 day window when the demonetization operation takes place. In the end the article mentions the amount is conservative and it is for the first 50 day period only. There are surely going to be long term devastating effects on the economy. 

The foreign tourism industry is destroyed as tourist are only allowed to convert only about $70 per week to Indian currency, which is just peanuts. The foreigners who visit India during this time will have to face lots of hardships and they will never comeback to this country. 

Each and every sphere of the economy is badly affected. As much as 400,000 or more jobs will be lost in labour intensive industries. It was expected that the demonetization operation would clean up the black money in the nation, however channels have opened up that is helping people to change their old hoarded black currency into new, thus effectively converting their black money into white for a 30% commission. 

There are many more things that are not reported in the media like broken marriages and other hardships faced by common people. The Prime Minister had announced that after 24 th Nov the amount of money that can be withdrawn or exchanged in the banks will go up. On the contrary the amount of exchange per individual has come down to ₹2000 per day and on 24th it was announced that people would no longer be able to exchange old 500 and 1000 notes, they only will be able to deposit them.

Now 47% of Indians don't have bank accounts, most of them are poor people. They would have saved their life long earnings in form of ₹500 and ₹1000 notes, what happens to them?

The entire demonetization operation has rather become a moneylaundring work in which the rich are the ones who are benefited while common people have to go through tremendous hardships. It will paralyze the Indian economy if proper action is not taken by the judiciary, which is now the only hope of the common man. 

Currency Recall in India

On November 8th when the world was glued to US presidential elections, the prime minster of India declared that Indian currency notes of denomination  ₹500 and ₹1000 were no longer valid from 24:00, Nov 8th. The news spread like wild fire across the nation. People thronged towards different ATMs to withdraw money of amount ₹400 per transaction so that they could get ₹100 notes many ATMs ran out of ₹100 notes. 

The following day was declared as bank holiday and then the banks were supposed to be open even on weekends. From November 10th one can see huge ques across all the bank branches and ATMs across the country. Many ATMs are shut down for the want of cash. 84% of the printed currency was in form of ₹500 and ₹1000 notes that are out of circulation now. 

It is a fact that the neighbouring countries of India are circulating counterfeit currencies in mostly of denomination ₹500 and ₹1000. The move to recall this notes will make the counterfeit currency useless. There are many bureaucrats, corrupt government officers, unscrupulous businessmen who have loads of black money hidden as cash in form of notes of ₹500 and ₹1000.

 However many black money holders have hidden their black money abroad in tax havens like Dubai, Switzerland, Singapore, Panama, Malta etc. Many have them locked in form of gold bars and jewellery. So these people won't be affected by the decision taken by the government. 

While the decision was necessary poor planning in implementing this project has created chaos across the nation and common man of the country is the one who is worst affected. To begin with proper arrangements were not made and extra counters were not opened for people to exchange notes. Many people in India don't have bank accounts specially in villages, where the nearest bank branches are many kilometers away, they have their lifetime of savings in form of these notes which they can't use immediately. 

It is said that this move was made to fight the menace of black money, however new ₹500 and ₹2000 notes are being introduced. So again the government is making it easy for the corrupts to keep their black money safe. Again the current ATMs are not calibrated for the the new notes, so people are unable to withdraw the new currency notes from the ATMs.

On November 9th many major national dailies had a front page full advertisement of an online app based money transfer app company which sported the picture of the prime minister of India. Now the declaration of banning the notes was made at around 8pm by Prime Minister. At 10pm the newspapers went for print. So if indeed the operation was confidential then how come within 2 hours such arrangements can be made. There is clear indication that the people close to the ruling party knew beforehand that such a decision was coming and they made all the necessary arrangements to overcome any situation of their unaccounted cash becoming useless. 

It is clear that out of the 14.5 lakh crore worth of notes in circulation before demonetization. A very small proportion of unaccounted cash will be collected by the government. Maybe around Rs 1 lakh core or a little more. However what matters is how the money is used. It is highly likely that the money will be stolen again and very little will be achieved by this move. Since the current ruling party and government does not have any interest in eliminating corruption because it is gaining from it and they are in politics to make money from corruption rather than serve people. 

Reducing rabies deaths and saving money

 Every year in India 20,000 people die because of rabies caused by the bites of road dogs. There are around 30 to 40 million road dogs across India. Now if these road dogs are caught and used as a source of food for the carnivorous animals in the various zoos of the country, not only we will save money on buying meat but also effectively reduce and contain the number of street dogs.

Lions, tigers, cheetahs, leopards, crocodiles have to be fed meat anyway. For that either a goat, buffalo or chicken has to be slaughtered. The meat is also expensive however with street dogs we are going to get the meat for absolutely no cost at all, at the same time we will successfully reduce the number of deaths caused by rabies.

So we effectively kill two birds with the same stone. Save lots of money that would have otherwise be spent on buying meat for animals and save the people of this country from rabies.  

From Russia with Love

After the second world war USSR emerged as a world power. The country conducted its first nuclear test in 1949 and that marked the beginning of the era of cold war between USSR and USA. Both the countries kept investing a lot in their nuclear capability and military research. The two nation conducted hundreds of nuclear tests, the most powerful being the Tzar Bomba test by Russians which was approximately 1500 times more powerful than the combined power of the atom bombs fired in Hiroshima and Nagasaki.

There was competition between the Russians and Americans in space as well. The Russians were the first to send a satellite to space and the first man who went to space was a Russian name Yuri Gagarin. Ultimately the space race was won the Americans when they were able to land man on moon.

While the two nations were competing with each other on many fronts. The other countries of the world took their sides, some went with US while others supported USSR. India was a part of the non aligned movement. However India's relations with Soviet Union was very good.

When India attacked and annexed Goa in 1961, UK and USA moved a resolution condemning the act in United Nations. The resolution was however vetoed by USSR. Similarly in the 1965 and 1971 Indo - Pak wars, it was due to the Soviet Union that powers like UK, USA desisted from attacking India. In the 1965 US was a supporter of Pakistan and had supplied the latest tanks to the nation. In spite of having the latest tanks Pakistan lost the war.

In the 1971 India-Pakistan war that resulted in liberation of Bangladesh. The US, UK and China were in support of Pakistan but due to Soviet Union they were not able to take any drastic action on India. Russia has been one of the biggest military suppliers to India. We received a lot of help from Soviet Union in the initial stages of our space program. The cryogenic engines supplied by Russia were used in our GSLV till we developed our own cryogenic engine.

The world has changed a lot since then the attitudes of USA and UK has changed towards India. US in particular has realized its folly of supporting Pakistan after the 9/11 attacks on the twin towers of the World Trade Centre and its aftermath where it had to spend huge amount of resources in tracking down laden in Pakistan and killing him. Many US soldiers have lost their lives in the last decade in the war against terror. US had to spend over $1.7 trillion (1,700,000,000,000) in the war against terror that started after the September 11 attacks.

The cold war ended with the division of USSR, the USSR was economically destroyed because it followed a socialist system which ended up breeding lot of corruption and made the nation bankrupt. The world was no longer polarized. The attitudes of US and UK towards India changed, maybe due to the big number of scientists, doctors, engineers, businessmen etc from India living in this countries might have played some role.

Even after USSR, Russia is a world power and a major weapons supplier to India. India is now militarily strong enough not to be bullied by other nations, India is also a nuclear power. However the first few decades after independence of India was tough. With a few key nations against it survival was difficult. Russia in spite of being a communist nation had helped India during those tough times. India must always maintain good long term relations with Russia which is now turning into a democracy with market economy. 

Delhi got AAP now its time for Punjab and Goa

Delhi is reaping in the advantage of voting for Aam Aadmi Party in the February 2015 Delhi Assembly Elections. They are now spending nothing on water, half the amount they used to on electricity. The corruption levels in government offices have come down due in spite of the Centre snatching away the ACB from Delhi government. 

Delhi government increased the budget allocations in education and healthcare. Thousands of new classrooms are now being added. A new school has come up that has facilities that surpasses the facilities provided by even big private schools. Earlier private schools arbitrarily increased the fees . However with the AAP government schools are not able to increase the fees and in many situations they are forced to give back excessive fees they charged from the parents. 

The conditions of hospitals of Delhi has improved. Over 100 Moholla clinics have been opened till now and by the end of the year the numbers are going to go up to 1000. There is lot more that has happened. While Delhi is reaping the benefits of a corruption free state government. One's thoughts goes out to the selfless AAP volunteers who worked hard on ground day and night to make this change happen. 

Many of them had given up their jobs, shut their shops to campaign for AAP. Many of them were arrested at times even beaten up by police. They did all this for the good of their fellow people without thinking about themselves. They worked hard to convince people to vote for AAP for their own good. 

While Delhi is reaping the benefits the rest of the country is suffering for voting for Modi in the General Elections of 2014. Not a single promise has been kept instead the people of the country are greeted with price rise in every commodity including petroleum products(in spite of the fact that the price of petroleum has come down over 3 and half times since Modi became PM), slow industrial growth and increasing communal intolerance. 

Modi is trying his level best to finish democracy in the country. The suicide rates of farmers has gone up. The people of the country got a golden opportunity in the 2014 Loksabha elections to make change happen by voting for AAP. But the fools went by the media rhetoric and chose to vote for Narendra Modi. 

The idiots of India did not realize the fact that such large scale advertisements costs hundreds of crores in terms of money. So if someone spends so much to become PM, after he achieves his target , he will loot the same people who voted for him. It is this stupidity of Indian public that the corrupt politicians have always taken advantage. 

Next year AAP will be standing for Punjab and Goa Vidhansabha Elections. I just hope that  the people of these two states are smart enough to vote for AAP for their own good. 

The government and JNU

In the last few days the news channels are filled with news of the JNU incident in which allegedly some students shouted a few slogans that were supposed to be anti India. The student wing of BJP, ABVP started agitations against this. The ruling government got Delhi Police to arrest JNU student leader Kanhaiya Kumar and book him under sedition charges. Delhi Police that reports directly to the home ministry raided the hostels of JNU students. 

It should be noted that Jawaharlal Nehru University is one of the best University in the country. Only students with exceptional merit make it to the University. The video footage shows that Kanhaiya Kumar was not at all involved in the incident. He did not raise any anti India slogans. A video of a speech given by him showS him saying that "He believes in the constitution of India", the video is not anti India at all, it is pro India. 

In reality RSS and BJP has used this incident as an opportunity to try and subvert the Freedom of Speech and Freedom of Expression granted by our constitution. What happened after that was even more ugly. When Kanhaiya Kumar was brought before the court. Some pro BJP lawyers stormed in the courtroom and beat up JNU students and media. A BJP MLA of Delhi O.P Sharma beat up a student alleging that he used the words "Pakistan Zindabad". Even journalists covering the incident were beaten up and abused. 

They repeated the incident the next day in spite of heavy police security. None of the rioters were arrested. This is a very ugly situation in the country where the ruling government is using its resources to terrorise students most of whom are innocent. 

Yes it is true that  if someone has given anti Indian slogans and tried to incite people into anti India activities, against such person action must be taken in accordance to the law of the land. But using it as an excuse to terrorise innocent students and public is a grave crime as well.

It is very much possible that the ruling government is doing this hide its own failures. An effort is being made to introduce an environment of hyper-nationalism in the country where opposing government's action can lead one to be tagged as anti national. 

One more very vital news that is being suppressed in the media due to the JNU incident is the massive increase in the amount of NPAs of nationalised banks, the defaulters are billionaire corporates. Already in tune of Rs 1,14,000 crore of debt has been waived off. The profitability of nationalised banks have come down. In fact just a few days ago IDBI showed huge net loss of Rs 2,184 crore in the 3rd quarter- highest ever by a nationalised bank. 

Ordinary people of India have their lifelong savings in this banks which are happily waving off the huge corporate debts under instructions and pressure from the central government. 

One just hopes that The Supreme Court of India and President of India take some action and restore sanctity in the country. I am confident that democrary will win. 

India and Pakistan- Why they were created?

In the 19th and early 20the centuries Britain were a force to reckon with. Great Britain ruled over many different nations across different continents. The sun never sat on the empire. They were a bunch of cruel and atrocious rulers. Millions were murdered in their rules. Millions had to live in abject poverty wherever they ruled. The were racists and treated people worse than slaves. Dear readers please note that this were the British people 100 years and not now. Today's Britain is way different and the people of that country are way better than their ancestors. 

Before the British established their rule in India, India was quite a rich nation. However after they started ruling the Indian industries were destroyed because of British policies and major portion of the nation was now poor. It took many decades of freedom struggle both violent and non violent to achieve freedom of India. The second World War ruined England.  In 1946 the Bombay Naval Mutiny sowed the seeds of Indian freedom. After the Naval Mutiny which spread across to other wings of the armed forces, the British could no longer depend on Indian armed forces. They knew very well that it was impossible for them to rule a nation where the armed forces were against the rulers. So they decided to leave India and grant her independence. 

However history of England suggests that It has always tried to annex the country back to which it had given freedom. An example of that is USA, after giving them their freedom in 1776, UK tried to get US back through the War of 1812, however they lost. In India when the freedom movement started the British followed a policy of divide and rule, they divided the local populace on religious lines and made people of the two major religions Hindus and Muslims fight among themselves. They called this policy divide and rule and it worked quite well for them. 

When British decided to give freedom to India, they tried to divide the local populace on the basis of religion. For this they availed the service of one Mohammad Ali Jinnah, who advanced the two nations theory, under a pretext that in the newly freed nation it would be impossible for Hindus and Muslims to live together. Now when his demands were not met, he made a call for Direct Action. It was followed by lots of violence across the nation in which thousands of people died. 

Now Jinnah did not have the resources to create such mobs. How did the mobs come into existence? The infrastructure of such mobs were created by the British, who used it from time to time to make Hindus and Muslims fight among themselves. The quantum of violence was so high that out of desperation to stop the bloodbath, the leaders accepted the partition of the nation.

On the western part a huge part of Punjab,Sindh, Frontier Province and Baluchistan; on the eastern front the state of East Bengal were separated from India and a new country named Pakistan was formed. However this was just the beginning of the mayhem. There was a big movement of people across the borders of both nations and there was a great amount of communal violence during partition that lead to death of around 2 million people. There was tremendous amount of loss of property as well. Thousands of women were raped as well during this riots. 

Even this was not enough. Jinnah died within an year of formation of Pakistan and army became supreme in that country. For the army to maintain its influence, they needed a perpetual enemy, they found one in India. In 1965 Pakistan attacked India to annexe Kashmir, they were militarily better equipped than India, they had the latest Patton tanks, but in spite of that they lost the war. 

Meanwhile East Pakistan wanted to become free from Pakistan. The Pakistani army killed over 3 million people in East Pakistan and raped over 200000 women. In 1971 India defeated Pakistan in 14 day war and freed East Pakistan, the newly formed country was named Bangladesh. 

Since then Pakistan resorted to cross border terrorism to destabilise India. However the same terrorists hit back on Pakistan and even in that country thousands of people died because of terrorism. The Islamic terrorism spread across the world and today has affected almost each and every part of world. Pakistan gave a safe asylum to Osama Bin Laden in Abbotabad. So you see at the core of global terrorism is the division of India and Pakistan that happened due to the cunning British policies. 

The Odd-Even car formula in Delhi

Delhi is the capital city of India. Around 17 million people live in the city of Delhi. It is a cosmopolitan city which has people from different parts of India. Delhi also happens to be one of the most financially prosperous cities of India.

The economic prosperity has meant greater purchasing power of people. Hence a big proportion of Delhites own cars as compared to people of other Indian cities. The emission from the cars have resulted very high levels of air pollution in Delhi. The proportion of suspended particulate matter in air of Delhi is many times more than safe levels.

The air quality of Delhi is very poor. This has serious implications on the health of people. The citizens of Delhi can contract serious diseases. Also this pollution has the potential to destroy the immune system of people, thus making them vulnerable to many diseases. 

Although the city of Delhi has a good metro-rail system. The bus infrastructure is not very good. So people have to rely on self owned vehicles to commute around the city. Using cars in huge numbers has lead to rise in pollution levels. In India, diesel is far more cheaper than petrol. So a big number of cars are diesel cars and diesel cars pollute more than petrol cars. 

To overcome this huge air – pollution problem, the Delhi Government decided to introduce an odd-even scheme. Under this scheme on days when the date of the month is an even number, only even numbered vehicles can ply on the roads of Delhi. On odd dates, odd number vehicles will hit the streets of Delhi. 

The scheme has been introduced from January 1st. People have given a positive response but obviously there are some grievances as well. The initial dip in air pollution graph is encouraging. However the real effects of introduction of the odd-even scheme will be clear in a few days. 

People are encouraged to pool cars to go to office. The cars that run on CNG are exempt from this rule since combustion of CNG does not release any suspended particulate matter. Another category of people who fall under the exempt category are those who are physically disabled and single woman driving cars. Most VVIP's fall under the exempt category. The Delhi CM himself falls under the exempt category but he is pooling car with his ministers. 

Many MPs of Delhi pooled cars or used E-Rickshaws or motorcycles to go to work. Ambulances, police vehicles etc. fall under the exempt category. The AAP government has been quite successful in getting the point across to people regarding the health hazards of people. Otherwise such huge support of people to the Odd-Even formula was unprecedented. 

This again shows what a honest government in power can do. Pollution in Delhi is not a new problem, however the previous governments decided to sit on the problem instead of doing something about it. 

One just hopes the Odd-Even car formula and the future pollution control measures help Delhites live in a clean, clear and healthy environment.