Shri Anil Bokil of Arthakranti Pratishthan, who has been instrumental in the ‘surgical strike’ against black money in the country on November 8 in the form of demonitisation of Rs 500 and 1000 notes, terms the initiative just first stage of a larger surgery. “This is the beginning of a larger procedure. It is like performing a surgery on an old cancer. The anesthesia has been given to the patient and now the surgery is the only option. The surgeon is ready for next move. The ball has been set in rolling and there is no return back. Demonetising the money will bring all stashed money in the banking system,” he said while exclusively talking to Organiser representative Devidas Deshpande. He opines that undeniably, people are feeling pain but this pain is of the surgical operation, not of the disease. If we endure this pain, a bright future awaits us. There is no need to panic. Excerpts:
What were the Arthakranti Proposals?
In Bharatiya economy, cash transactions far outweigh transactions through the banking system – as much of 80% of the economy is cash based leading to an unhealthy development of the banking system, which is the backbone of any modern day economy. What is worrisome is that every passing year, the percentage of cash transactions is growing rather than shrinking! The “have-nots” remain outside the banking system and never get a chance to establish their credibility. This keeps them at the mercy of the cash economy or parallel economy. Flawed and failed taxation system, irrationally high denomination and its irrational distribution and underdeveloped banking system are the results of this system. The country is not bereft of any resource, but common man does not get them. The money is diverted half way and paves way for the black money.
The Arthakranti Proposal prescribes the remedy on this malady in the form of following measures: Withdrawal of existing Taxation System Completely (except for customs or import duties), routing of every transaction through a bank that will attract a certain deduction in a specific percentage (say 2%), crediting the deduction in the government's coffers like Central, State and Local (as say 0.7%, 0.6% and 0.35% respectively) and offering a share (say 0.35%) from the deducted amount to the transacting bank. Most importantly, it stipulates withdrawal of high denomination currency (say above Rs. 50) and making legal
provisions to restrict cash transactions up to a certain limit (say Rs 2,000). This means that the cash ttransactions above this limit will not enjoy any legal protection.
Do you think the Modi government has taken first step in the direction provided by your proposal?
This is not the first step or first stage. This is the beginning of a larger procedure. It is like performing a surgery on an old cancer. The anesthesia has been given to the patient and now the surgery is the only option. The surgeon is ready for next move. The ball has been set in rolling and there is no return back. Demonetizing the money will bring all stashed money in the banking system. What is black money at all? All the money, which escapes the taxation from the government agencies is black money. Thus, if all the black money lying uselessly appears in the legal system, the government will get additional revenue. The denomination will force the people to bring their money into the exchequer and government will know how much money the people have. As of the moment, we even don’t know to what extent the notes are in circulation!
That is why I do not see this as a first step or a primary stage. I see it as a start of the major operation wherein the surgeon has made the patient unconscious and taken over the responsibility of curing him.
Do you think PM Modi will carry out these reforms?
Why not? One, he enjoys a full majority, the lack of which was a problem area for his predecessors. He has a strong resolve and he is ready to act on his words. He has come to power with the
commitment to the people to eradicate black money and he is fulfilling it.
Till Tuesday (November 8, 2016) evening, nobody ever dreamt that any politician will take such an action. Even I would have hesitated to say that it would be a reality. We are working on this proposal for 16 years and have approached successive governments. “The politicians themselves are the source of black money, they cash stashed with them. How can they demonetise,” was the question on everyone’s lip. Now, this is a fact.
Even though the PM made this announcement all of a sudden, it was a long process and too much
deliberations happened over the matter. So, there is only one way forward. Our current economy is undergoing a
treatment. How long this process lasts will depend on the patient's response.
Have you been in contact with him?
The Prime Minister is an institution, he is not a person. He is so busy that he has no time even to meet his family members. Therefore, PM and we were engaged in discussions at institutional level and not the family level. The way the secrecy was maintained was also commendable.
While demonetising the old notes, the government is also bringing in new Rs 500 and Rs 2000 notes. The move has attracted criticism and the people express doubts on the government's motive?
See, this is a kind of a heart transplant operation. The currency is the heart of the economy. When we want to
transplant a new heart in the old body, there has to have some provision of beating heart, otherwise the body will not survive. Likewise, to infuse the credit, there has to be some kind of currency in the market. That is why the new notes are being introduced. This is only a stop-gap arrangement and they will cease once the body is recovered. Once there is a major shake-up in any system, various opinions and reactions appear from every quarter. One has to take them into consideration. However, why did the academicians and intellectuals not offer their prescriptions when the country ailed with this disease so long? The solution on the black money problem should have come from them. The academicians are the scientists who formulate the medicines while governments are the doctors who administer them. Here, the PM himself has assumed both the roles and came up with the treatment. Moreover,
economy is never a static arrangement. It always changes and one has to find cure on the prevalent maladies at the appropriate time. The black money menace has become a cancer that a major surgery was called for. Solutions to another problem may be found once they assume grave proportion.
Some opine that even the Janata government had abolished high denomination notes in 1978. That did not curb the black money or parallel economy in any way. To what extent can this be true?
It is true that the Janata government banned the high denomination notes. However, the total value of those notes in circulation at that time was in few crores while they were worth 97
thousand 676 crores in 2001. It is akin to the level of water in a tank. In 1978, the water came up to ankle while it has crossed our heads in 2016. The intellectuals have a habit of thinking in this manner which is why they have failed to provide any solution to the problems.
A high denomination note lying with you is like a book you own. It
provides no value to you or anyone else. The spurious transactions are easier with the high denomination notes. On the other hand, a small note makes transaction difficult. Therefore, they are not stashed and thus come into circulation. Thus, they become like a public library book that anyone can use.
In a country like Bharat, where 90 per cent transactions occur in cash, turning people to cashless transactions or banking is like a culture shock. How do you see the reactions of the people on this decision?
The common people are happy. The noise of the implementation being
difficult or with hidden motive etc. is being made by who are uncomfortable with it. The public has accepted it with an appreciable patience and calm. They are going through the hardships but they are okay with it because they know that even though they have to suffer for a few days, it is for the
betterment of their future. The common people know how the black money impacts their lives in undesirable ways. Undeniably, people are feeling pain but this is pain of the surgical operation, not of the disease. If we endure this pain, a bright future awaits us. There is no need to panic.