Wednesday, November 8, 2017

One Year After Demonetisation: BJP Still Mounting New Goalposts

We, the people of India, today observe the first anniversary of an enormous tragedy that caused widespread distress and suffering to 125 crore Indians. The unwitting, thoughtless, unplanned and mismanaged decision of the Prime Minister, Narendra Modi – completely driven by personal ambitions thrusted upon 125 Crore Indians has resulted in an ‘Economic Disaster of Monumental Proportions’. The Narendra Modi Government has launched a no holds barred publicity blitzkrieg to convert the entire debate of demonetisation into binaries of ‘Black Money vs White Money’, but the reality on the ground is that there is insurmountable pain and anguish. 

PM Narendra Modi inflicted a ‘Scam of the Century’ at the expense of our countrymen by this reckless decision. The BJP indulged in organized loot and legalized plunder while the common people of India were forced to queue outside banks and ATM’s. Today, we recall those unsung, unspoken and undocumented people who lost their lives when PM Modi conducted this gigantic social experiment to traumatize them. While the back bone of India’s Economy – the Informal Sector which consists of crores of farmers, daily wage earners, migrants, labourers, craftsmen, street vendors, small traders was devastated by this one ‘Tughlaqi Farmaan’ by – the BJP converted crores of its ill gotten money into ‘legal tender’. 

Demonetisation displayed a brazen display of utter disdain by the Modi Government for Institutions. The reputation of the Reserve Bank of India was shattered into pieces. One man’s adventurism writ large as an unplanned, ill prepared Government and administration took upon itself to implement this huge exercise. Not less than 135 notifications and orders were passed and rules were changed by the minute to enforce the will of one person, while the citizens suffered. 

None of the stated objectives of eliminating black money, terror financing and counterfeit currency have been met. To promote a less-cash economy, coercive steps like demonetisation were ineffective. The Cash in Circulation after one year is close to 90% of previous levels. The fact that more than 99% of the demonetised currency came back into the banking system, has punctured the government’s claims. There are also widespread reports of the rich converting their black money into white while the poor suffered. 

Where has the Black Money gone?

RBI Report reflects that out of 15.44 lakh crore money in circulation at the time of demonetisation on November 8, 2016; Rs 15.28 lakh crore have been received back. It means that only Rs 16,000 crore did not come back, so far. 

On the contrary, Prime Minister and Finance Minister had claimed that demonetisation would result in non-deposit of Rs 3-5 lakh crore of black money. On December 10, 2016; Attorney General, Mukul Rohatgi told the Supreme Court that “The Government expects Rs 10 or 11 lakh crore out of a total of Rs 15 lakh crore.

Will Modi ji answer as to where has the black money gone, as almost the entire money has been re-deposited?

Where is the ‘Fake Currency’? – Is it Another ‘Jumla’?

PM Modi had announced that detecting fake currency notes was the logic behind demonetisation. Even Finance Ministry in its press release dated 8th November, 2016 had stated detecting fake currency as the reason for demonetisation.

RBI Report has revealed the falsehood of this claim also. Out of 15.28 lakh crore currencies received back, only Rs41 crore currency was found to be fake i.e. 0.0013%. Once 99.998% currency has been found to be genuine, and then the entire logic given by Prime Minister has utterly failed.

Fake Currency in shape of the new Rs 500/Rs 2000 notes has already been detected. In one case, children were caught photocopying and circulating the new Rs 2000 note. 

Has Terrorism &Naxalism been curbed?

Another reason given by Prime Minister Modi for demonetisation was stoppage of terrorism and Naxalism. Facts belie this claim also. Post-demonetisation, there have been 50 major terror incidents in J&K alone, in which 80Jawanshave been martyred and 51 civilians killed.

Also, there have been 17 major naxal attacks after demonetisation, in which 69 security personnel were martyred and 86 civilians killed. What is the logic of Prime Minister’s claim is un-understandable in view of these figures? 

Cost of printing ‘New Currency’ is more than ‘Savings’- Proves the folly of Demonetisation

RBI Report says that only 16,000 crore was not deposited back. RBI Report further reveals that a sum of Rs.25,391 crore was spent on printing/logistics of New notes. Will Modi ji tell the logic of spending 25,391 crore rupees to save 16,000 crore rupees?

Has India moved towards a ‘Digital Economy’? 

Last reason given by PM Modi was promotion of digital transaction in the economy. Even this logic appears to have failed. In November, 2016 (prior to demonetisation), value of digital transactions in our economy was 94 lakh crore. Post-demonetisation in July 2017, value of digital transactions was 104 lakh crore i.e. a mere jump of 10 lakh crore over pre-demonetisation period. 

Truth is that the biggest increase in digital transactions happened during Congress-rule. Between 2011-12 to 2012-13, digital transactions jumped by 53%. Between 2012-13 to 2013-14, digital transactions again increased by 49%. This data completely defeats the assertions of the Prime Minister.

Has ‘Black Money’ been seized? 

PM Modi and FM Jaitley have been brandishing that since November 2016 upto May 2017, a total Rs 17,526 Crore has been detected as ‘Undisclosed Income’. They forget to mention that 5 times more ‘Black Money’ was unearthed by Congress-UPA in the last two years of the Congress Government. (As seen below)

As we witnessed hundreds of stories of distress and sufferings, the Government kept changing goalposts to project a positive narrative. Now the BJP spokespersons and propaganda machinery is now mounting new goalposts. 

Firstly it is claiming that ‘Formalization of the economy’ by increase in the tax payer’s base. This is factually wrong. According to the Finance Ministry's Annual Report, the year-to-year growth in the number of tax payers in 2016-17 was 26% (with demonetisation), which is less than 27.6% during 2015-16 (without demonetisation). The Modi Government changed the very definition of the ‘tax base’ and ‘new tax payers added’ through the CBDT, on the recommendation of the Avadhesh Kumar Mishra Committee. As per the new definition, ‘new tax payer added’ are all ‘persons from whom the TDS/TCS deductions are made’. Thus, BJP’s claim that more people are now under the tax net is as manufactured as its GDP numbers based on changing the criteria altogether.

Secondly, PM Modi recently claimed, in an election rally, that since India’s ‘Cash to GDP ratio’ has fallen substantially, we have less cash in the system and corruption has gone down. PM forgot to mention that 'currency in circulation' is back to pre-demonetization level. 15.45 lakh crore were demonetized but ' new currency in circulation' is back at 16 lakh crore. Some simple facts puncture the story further. As on March 31, 2017, the cash to GDP ratio had stood at 8.8 per cent, while in June 2017, it increased a shade higher to 9.9 percent as compared to pre-demonetisation cash to GDP ratio of 12.2 per cent. What the Government is not telling is the simple fact that if the economic activity slows down, the growth in currency in circulation is bound to plunge. For the period of three months ending March 2017 and June 2017, the non-government part of the GDP (which forms around 90 per cent of the GDP) has grown by a little over 4 per cent. Further, the Reserve Bank of India tells us that India's Cash to GDP ratio is now close to countries like Germany and France. But if we take the example of another developed country like Japan which has the highest cash to GDP ratio at 19.4 per cent, then will it mean that Japan has wide spread corruption? Answer is simply no. Even as per the Transparency International's Corruption Perception Index for 2016, Japan is the twentieth least corrupt country in the world. Unfortunately, India stands at the 79th position, despite having much lower cash to GDP ratio.

Third ‘Jumla’ which is being parroted by BJP leaders is that ‘interest rates for loans’ have seen a substantial decline. This is hogwash. BJP Government has actually targeted the country’s ‘Saving Rates’. Since 2014, BJP has made atleast 8 revisions in the interest rates for various saving schemes including Savings Bank Rate, Public Provident Fund, Kisan Vikas Patra and Sukanya Samriddhi Yojana. When there are no savings, then reduction of ‘interest rates for loans’ will be meaningless.

For example, Government’s principal bank i.e. State Bank of India (SBI) slashed saving bank interest rates from 4% to 3.5%. Saving Accounts in SBI are currently estimated at 37 crore with a deposit of 9.4 lakh crores. If there is a reduction of 0.5% in interest rate, there is a direct loss of Rs.4,700 crore annually to the 37 crore account holders. Couple this with the multiple charges being levied on ATM, Bank and Digital transactions; this has burned deep holes in the pockets of ordinary citizens.

Fourthly, we are being lectured on ‘loot’. This is preposterous. In September, 2016; bank deposits in scheduled banks saw an additional increase of Rs. 5,88,600 lakh crore. Out of this, fixed deposits made between 1st September to 15th September, 2016 alone were over Rs.3 lakh crore. Does it not prove advance knowledge of the decision of demonetisation and conversion of money?

Lastly, The BJP Government is claiming that now it has now obtained the ‘addresses’ of those who deposited 99% of the demonetized currency in banks. This is the biggest lie. Had it been the case, BJP Government had complete 365 days and all means to trace these addresses. Not even a single FIR has been registered against such people. Merely floating mismatched figures in the media only reflects a ‘shoot & scoot’ strategy. There is not a single document in public domain which names these tax evaders. Why is PM Modi lying ? 

Demonetisation has turned out to be the biggest scam of independent India. Examples are many:-

(i) Kolkata Unit of BJP was caught depositing Rs.500/Rs.1000 notes running into Rs.3 crore on the day of demonetisation in A/c No. 554510034. Despite repeated demands, BJP and RSS have not made public details of money deposited between Ist March, 2016 and 8th November, 2016 in its bank accounts across the country.

(ii) In the run-up to decision of demonetisation, BJP and RSS purchased properties running into hundreds of crores across the country. Congress has released details of 8 properties valuing Rs.3.41 crore in Bihar and 18 properties in Odisha. Actual market value of these properties is much higher. Despite this, Narendra Modi and Amit Shah have refused to make public the details of properties purchased by BJP/RSS in last one year. Does it not prove that BJP had advance knowledge of the decision of demonetisation and was converting its black money into assets immediately before demonetisation?

(iii) In September, 2016; bank deposits in scheduled banks saw an additional increase of Rs.5,88,600 lakh crore. Out of this, fixed deposits made between Ist September to 15th September, 2016 alone were over Rs.3 lakh crore. Does it not prove advance knowledge of the decision of demonetisation and conversion of money? Modi government has been unable to explain it nor has made public names of everyone, who had deposited Rs.25 lakh or more.

(iv) Shockingly and just before demonetization on 08-09-2016, cash of Rs.3 crore was seized from a Maruti Swift Car bearing Regn. No. HR-26AR-9662 at Indira Puram, Ghaziabad, Uttar Pradesh. The two occupants of the car, Sidharth Shukla and Anoop Aggarwal claimed that the money belonged to them and they were taking it to Lucknow. Ghaziabad City BJP President, Ashok Monga reached the Police Station and certified on a letter pad that the money was being ‘sent by BJP Central Office to BJP State Office in Lucknow’. Will Modiji and Amit Shah answer the source as also the reason for transferring the money in stashes of cash just before demonetisation instead of a digital transfer, which they are promoting? 

As ordinary people languish in bank lines for days together to withdraw their own money, a parallel ‘black market’ flourishes in converting black money into white by charging a commission upto 30% as also sale and trading of new currency notes with the tacit approval of Modi government. Important issue is that role of none of the BJP leaders involved has been investigated.

(a) BJP National President, Amit Shah is a Director of Ahmedabad District Cooperative Bank, Ahmedabad. As much as Rs.500 crore were deposited in this bank within 3 days of demonetisation. Why has Amit Shah not been investigated?

(b) BJP Maharashtra Minister, Pankaja Munde and her sister & BJP MP, Pritam Munde are owners of Vaidyanath Urban Cooperative Bank. In a raid, a sum of Rs.10 crore in old notes and Rs.10 lakh in the new currency of Rs.2000 were recovered. Why have they not been investigated?

(c) Mahesh Shah of Ahmedabad, Gujarat made a declaration of Rs.13,860 crore in the voluntary income disclosure scheme. He later resiles. As he was giving a TV interview disclosing names of politicians and bureaucrats, he was taken away by Income Tax authorities. Former Gujarat CM, Sureshbhai Mehta has openly spoken about links of Mahesh Shah with Narendra Modi and Amit Shah. Why have they not been investigated?

(d) Ramesh Gowda, an associate of Karnataka BJP leader & former Minister, G. Janardan Reddy, committed suicide and left behind a suicide note stating conversion of Rs.100 crore of black money by the BJP leader.

(e) Cash worth Rs.91.50 lakh was recovered from the car of BJP Minister for Cooperation, Subhash Desmukh in Maharashtra.

(f) A number of BJP leaders were caught with stashes of cash. Sanjiv Kamboj, co-Convener of Legal Cell of BJP in Punjab put up photographs on social media with wads of new Rs.2000 currency notes. Manish Sharma, a BJP leader from West Bengal, close to a Union Minister, was caught with Rs.33 lakh of new currency notes. In Salem, Tamilnadu; Arun, a BJP Youth Wing leader, was caught with new currency notes worth Rs.20.55 lakh. BJP leader, Sushil Vaswani was raided in Madhya Pradesh and a lot of ill-gotten money was recovered.