Currency Demonetisation and Future course of Indian Economy

Sachin · Post by **Sachin** » 31 Dec 2016 23:20

The feedback on today's speech by PM is largely negative (at least among my social circle & the news outlets I check out). There is no "positive vibe" is what I could make out. Folks are saying that the new schemes launched, ideally can be made in the "budget speech" by the Finance Minister. The PM's speech completely side lined the core issue; i.e the black money identified and neutralised.

Rishirishi · Post by **Rishirishi** » 31 Dec 2016 23:38

I am a bit surprised that Modi did not announce any radical move against benami property. Perhaps the demonitization has freaked him out.

Dipanker · Post by **Dipanker** » 01 Jan 2017 00:01

Rishirishi wrote:I am a bit surprised that Modi did not announce any radical move against benami property. Perhaps the demonitization has freaked him out.

Actually it should be much easier to handle, identify them, confiscate them, one benami property at a time! Let us hope that is next on the anvil plus the money in the foreign banks, and the gold hoarding.
Finally putting place mechanism for curbing generation of black money, and political reforms to eliminate use of black money in politics.

Singha · Post by **Singha** » 01 Jan 2017 00:50

As if now with hdfc bank my regn on bhim went ok but fetch balance fails silently

Tomorrow i will install on wife phone and send her 10 rs to axis bank as birthday gift

Singha · Post by **Singha** » 01 Jan 2017 00:51

Do i need to setup anything at hdfc end to make things work?

Lilo · Post by **Lilo** » 01 Jan 2017 01:07

Singha wrote:As if now with hdfc bank my regn on bhim went ok but fetch balance fails silently

Tomorrow i will install on wife phone and send her 10 rs to axis bank as birthday gift

You need to update BHIM app - then reset the pin in that request balance page - then after otp is recognized the request balance function will work.
Request balance should be working, onlee then one is set to do transactions afaik.

Singha wrote:Do i need to setup anything at hdfc end to make things work?

nyet , just your phone number should be linked to the Bank A/c

arshyam · Post by **arshyam** » 01 Jan 2017 01:14

srinebula wrote:
Primus wrote:Leaning towards doing that, my first concern would be paying the taxiwallah from the airport to the hotel.
Sir, Hyd airport has prepaid cab facility at arrivals. They accept cards; You shouldn't have any problem paying with your international CC.
This prepaid cab is also more convenient, as the cab will pick you up directly from near the arrivals gate (Used to be this way a year or so back; likely to be same now also). Other cab options require you to walk to the taxi stand.

Not true anymore. I used this prepaid counter at HYD last week, and they didn't have the CC machine. They issued a receipt and I had to pay the driver in cash. So don't expect this to work, better to be prepared. The currency exchange counter at the airport seems to be the best bet.

Other option you can consider is asking your hotel to send a cab to pick you up. May be they will charge a bit more but will save you the hassle of hailing a cab or finding cash.

This is a good idea.

Dasari · Post by **Dasari** » 01 Jan 2017 02:37

Sachin wrote:The PM's speech completely side lined the core issue; i.e the black money identified and neutralised.

Isn't this supposed to be on Jan 2nd? They didn't have the full numbers of deposits yet. They will have them on Monday morning. We can speculate it is Rs 14.5 lac crores but for PM it is premature to quote without getting all the data from banks.

R_Kumar · Post by **R_Kumar** » 01 Jan 2017 04:07

Rishirishi wrote:I am a bit surprised that Modi did not announce any radical move against benami property. Perhaps the demonitization has freaked him out.

I am guessing we might see something on this line close to the UP election.

hanumadu · Post by **hanumadu** » 01 Jan 2017 06:18

Dasari wrote:
Sachin wrote:The PM's speech completely side lined the core issue; i.e the black money identified and neutralised.
Isn't this supposed to be on Jan 2nd? They didn't have the full numbers of deposits yet. They will have them on Monday morning. We can speculate it is Rs 14.5 lac crores but for PM it is premature to quote without getting all the data from banks.

Is the Jan 2nd date confirmed. Can you provide a reference for it? I too was expecting at least the amount of black money people declared.

Dasari · Post by **Dasari** » 01 Jan 2017 07:07

I'm referring to this.http://www.indiatimes.com/news/brace-yo ... 68360.html

UlanBatori · Post by **UlanBatori** » 01 Jan 2017 07:20

Scary speech, nauseating "reactions" at least on Malloostan TV. These politicians (and mediots) are totally gutter class.

Speech scary in his complete shift of perspective to focus on the big picture: Reward the law-abiding, and heh-heh! to the others. ParitrAnAya sAdhUnAm, etc.

Basically said banks now have more cash, so let's go help ppl who obey the law and need help.
8% interest rate guarantee for upto 7.5 lac deposit per (taxpayer), for the next 10 years. (Is it really 8 percent fixed or usual rate+ 1% which is already the norm?)
Implication: rates are going to drop. Prerequisite for growth.
More credit for farmers & traders
More basic support for expecting mothers - presumed benefits in nutrition of new Indians. More 52-inch chests?

The chilling part was where he said: this will make you laugh, or very angry: you see all those mansions and big urban buildings, and all those fancy cars? Only 24 lac ppl filed taxes with > 10lac income.... the days are gone when honest people have to put up with crooks and corruption.

If you don't find that chilling on what is to come..

Surprisingly silent on the benefits of unglization. Good move: he does not want to paint "s*it here" on the Ungization initiative. I realized this when I saw the sheer pakiness of the "expert reaction" loudmouths. Nooo honest there at all!

Summary of Opposition "reaction":

BUT but but ... he PROMISED that after 50 days we can go back to EXACTLY the same as we were doing before Nov. 8!!

The commie wailing about how ppl don't understand why his ilk needs stacks of cash, was hilarious. Another one was absolutely having a tantrum.

SBajwa · Post by **SBajwa** » 01 Jan 2017 07:27

demo has hurt the WHOLE sell side rather than the buy side. People who used to selling their bulk goods and services for cash are facing the music. Some bulk sellers like farmers need to switch to net banking etc and will happen over a period of time and GOI has no control here. Some bulk sellers like daily labours working in labor intensive business need to demand wages in bank accounts and GOI is already bringing in law for this. So over all, political back lash will come from these BULK sellers and I hope they are a minority in the voting system.

" Wholesale sellers " are the real reason for all the corruption and black money in agriculture sector! These guys should be made bankrupt and put behind bars! From farmers to consumers there should be no one that does not add any value to the produce. only those that add value to the original produce/grains (weighing it, cleaning, packaging, transporting, etc) should be allowed rest kicked out! These people are the leeches of the Indian society and they have ruled for long!!

shiv · Post by **shiv** » 01 Jan 2017 07:32

Listened to Modi's speech in Hindi and 90% of the repeat in English. Plenty of stuff there to cheer some seriously large segments of the population.

Interestingly he has promised an interest rate fall for home loan takers in 2017 - which should encourage people who have retained some money in white to jump into the housing market in 2017, while he has actually promised to keep interest rates high for senior citizen depositors. Bot very good news for each segment.

Just like deposit into bank does not make black money white, Modi (or anyone) cannot judge or announce that X percentage of money deposited was black. That is a process that will be undertaken henceforth. But Modi mentioned a few interesting titbits. He said "here is a statistic that should either make you laugh or make you angry: Only 2.4 million Indians claim to earn more than Rs 10 lakh a year. How easy is that to believe looking at the huge mansions and expensive cars in our cities". He also wagged a threatening finger at erring bank and government officials who he said will not be let off

Singha · Post by **Singha** » 01 Jan 2017 07:33

Thanks Lilo it works now.

UlanBatori · Post by **UlanBatori** » 01 Jan 2017 07:36

Should be simple to set up a system where farmers enter what they have for sale, with point of pickup. People bid like eBay, and winner puts in a deposit and goes and picks up at point of sale. Transaction fully unglic.
Government can provide price support base as the bidding baseline.
Yes, unglization can bring amazing revolution in agriculture in a very short time.

rahulm · Post by **rahulm** » 01 Jan 2017 07:47

Happy new year to all and all that. I have never understood all this fuss over a Gregorian calender date and year change but never mind.

He has already announced emphatically that the next step is to pursue benami properties. Why repeat ?

In parts it sounded like a mini budget. Am I the only one who thought NaMo was lacking his usual mojo yesterday ?

There are a whole bunch of experts in the background who game and time each of his announcements and moves.

Many of the reforms he wants and we wish for are upto state governments who have their own reasons for wanting to maintain the status quo, even if such states also have a BJP government. In Goa, a very small state, there hasn't been any perceptibbl change in state and village level government functioning - efficiency to bribes, when, in fact, Goa should be one of the easiest states to transform amd reform.

Walk into a PMC ghetto oops office and its the same despite Mr Phadnavis being in charge.

I feel hNaMo's approach to change things structurally gives the best chance of success. Election funding reform is coming next and I think, hopefully, it will or should have a major impact on politicians, the bureaucracy's motivations and actions.

I wait with unrestrained glee and anticipation for the benami hammer.

UlanBatori · Post by **UlanBatori** » 01 Jan 2017 08:03

rahulm wrote: Am I the only one who thought NaMo was lacking his usual mojo yesterday ?

There are a whole bunch of experts in the background who game and time each of his announcements and moves.

Not a time for chest-thumping. A time for humble, awed recognition of sacrifice, and thanks to The People. The opposition idiots who rose to the bait, well.. can enjoy the results.

Rishi Verma · Post by **Rishi Verma** » 01 Jan 2017 08:11

On the occasion of New Year he didn't want to spoil the party. Thus subdued in his threats on upcoming action against benami properties. But personally i wish he had come out swinging against bm hoarders and the corrupt. It would have maintained the momentum for the upcoming elections in UP. I don't know why BJP is quite in UP. Probably because they know they can't win? Puzzling..

symontk · Post by **symontk** » 01 Jan 2017 09:13

UlanBatori wrote:True confession: I have been informed by SHQ that we forgot to bring the two 500Rs notes that have been kept buried in some box along with Vishu Kainettam coins (Malloostanis will recognize this hallowed tradition of baksheesh taught as a childhood expectation - did someone diss tipping here, hain?)

What 2 do with these notes? I have no sentiment when it comes to money. Sorely regret not cashing in all the Rapid Transit tokens ($1.75 each) when they switched to plastic card: I think I missed the boat on about 10 coins!

Cannot send these notes to relatives because they, being rejidents, cannot take those to the baink after yesterday.
No way to go to Rejerb Baink.
Can I just put them in an envelope with a note and send to my desi sarkari baink mgr for deposit? Or will the poor guy have to then go stand in line at Rejerb Baink? Do they need pharms with Explanashun? Do I have to prove that I was **NOT** in desh between Nov. 8 and Dec. 30?

Confused.

You have time until June to change it at RBI

A_Gupta · Post by **A_Gupta** » 01 Jan 2017 09:22

Per the news, for citizens of India who were outside the country from 9.11.2016 to 30.12.2016 the last date for deposit of Rs 500 and Rs 1000 notes is 31.3.2017. For Non-Resident Indians, the last date is 30.6.2017.

The maximum amount allowed per person is Rs 25,000/- (some different provisions apply to Nepal & Bhutan).
The copy of the requisite form to be submitted to Customs by the passengers on their arrival in India is available at www.cbec.gov.in (http://www.cbec.gov.in/). At the time of arrival in India, Customs stamp on such forms should be obtained, and submitted along with other documents the Reserve Bank of India may specify to the RBI Issue Offices.

rahulm · Post by **rahulm** » 01 Jan 2017 09:25

Finally installed BHIM on my phone. Install and config were a breeze. It mostly sets itself up.

A special acknowledgement and gratitude to the UI and UX designers to detect dual SIM cards and then prompt the user to select the SIM phone number tied to a bank account. The ICICI iMobile app requires the registered SIM to be in the primary slot else it fails. Bad design By ICICI.

I found BHIM to be nice and easy to use. They need to fast track the IOS version.

chetak · Post by **chetak** » 01 Jan 2017 09:26

Bart S wrote:
RajeshG wrote:Bartji, is there a place where the security/privacy aspects of the BHIM app is discussed ?
No idea about that saar, but the app itself is fairly new and it will probably take some time for all the pros and cons to be flushed out. Also, the app is being refreshed very frequently so even those discussions might quickly be outdated.

Can't recall now, but read somewhere that the security testing for BHIM is still on.

rahulm · Post by **rahulm** » 01 Jan 2017 09:36

Asked the horsemen at Panchgani Tableland if they accept payTM I got a humbling answer " Sir, uske liye phone bhi to waisa chahiyey. " Sir, that needs the right type,of phone I.e. Smartphone.

BRFites are an uber privileged lot. There is a whole world out there that lives in a different galaxy and the best way to explore this world is to trudge, mingle and listen to their words and get a sense of their feelings as they plead for inclusion

We need to made USSD ubiquitous and reliable. Every village sarkari school should have free classes on epayments. At the end of each class, participants should be required to shout JAI BHIM

shiv · Post by **shiv** » 01 Jan 2017 10:17

Rishi Verma wrote:On the occasion of New Year he didn't want to spoil the party. Thus subdued in his threats on upcoming action against benami properties. But personally i wish he had come out swinging against bm hoarders and the corrupt. It would have maintained the momentum for the upcoming elections in UP. I don't know why BJP is quite in UP. Probably because they know they can't win? Puzzling..

Perhaps they don't know "how to drive" the narrative?

prasannasimha · Post by **prasannasimha** » 01 Jan 2017 10:21

Pronlem with BHIM - requirees first SIM card to be the one to be detected.
Corporation bank and State Bank Associated Bank (like state bank of Mysore ) do not have still a UPI interface so GRrr essentially could not use it !!
Should allow one to register multiple bank accounts through registered phone

Vineetmehta_del · Post by **Vineetmehta_del** » 01 Jan 2017 10:45

Sachin wrote:PM mentioned about technology being used against black money holders. So don't know if any data analysis is being at this moment.

Yes. Data analytics is being used. They have access to lot of data form 61a, banking TX, old tax submissions, etc

Shivaji · Post by **Shivaji** » 01 Jan 2017 11:22

Dasari wrote:I'm referring to this.http://www.indiatimes.com/news/brace-yo ... 68360.html

I think, GoI would freeze all suspicious accounts and limit withdrawal from these accounts. Rest of the accounts would be free to withdraw like before 08-Nov.

People will start receiving emails / SMSes from IT department this Monday asking them to explain legality of deposits. Till that time, only sustenance level cash withdrawal would be allowed.

Warning to Bank officials in PM's speech may also be a signal for IT officials not to indulge in wrong doing.

GoI is not making random moves. It seems to be executing a well thought out plan and is open to tactical adjustments.

chetak · Post by **chetak** » 01 Jan 2017 11:51

Bart S · Post by **Bart S** » 01 Jan 2017 12:27

chetak wrote:
Bart S wrote:
No idea about that saar, but the app itself is fairly new and it will probably take some time for all the pros and cons to be flushed out. Also, the app is being refreshed very frequently so even those discussions might quickly be outdated.
Can't recall now, but read somewhere that the security testing for BHIM is still on.

If they haven't finished security testing it, they should not have released it.

shyam · Post by **shyam** » 01 Jan 2017 12:36

I think BR needs to have separate thread to discuss security aspects of digital economy. It has many vulnerable points which are both technical and operational. They all need to be brought up so that they can be addressed by the government. Ramana, can you start a thread? (Please don't ask me to start

)

chetak · Post by **chetak** » 01 Jan 2017 13:09

@ Bart S

This might help

http://www.news18.com/news/india/bhim-a ... 29552.html

BHIM App Review: The Beauty of This UPI App Is in Its Simplicity

Soumyadip Choudhury | News18.com @soumyadip

December 30, 2016,

BHIM App Review: The Beauty of This UPI App Is in Its Simplicity BHIM payments app

As part of the ongoing push for wider acceptance of digital payments in the country, Prime Minister Narendra Modi announced the launch of the BHIM app. The PM says the app is named after Bhimrao Ambedkar and the acronym BHIM also expands to Bharat Interface for Money. (You can download the BHIM app for Android from here)

The BHIM mobile payment app has been developed by the National Payment Corporation of India (NPCI) in associtation with Juspay and is part of Unified Payment Interface (UPI). NCPI says the app is interoperable with other UPI application from other banks. It is available for newer versions of Android and an iOS version is said to be coming soon.

The neat, clean and simple interface of the app is a welcome departure from other apps from the government. This is in tune with its stated purpose of simplified payments.

How to Use the BHIM app

To make use of BHIM app you will need to have an account with any of the 32 banks that have joined UPi (list of banks at the end of the post). The app is currently available only in English and Hindi. Given the wide diversity of languages in India, more languages are expected to be added soon. Also the phone number you use for the app needs to be associated with your bank account. At the moment it allows only one phone number and bank account to be linked with the app at a time. However, there exists an option to change accounts.

Unlike many other apps BHIM doesn't need a plethora of permissions from the user. It asks for access to SMS (to verify mobile number) and to make and manage phone calls (they say they need it to verify your phone with UPI). And in case you want to scan a QR code, it will ask for an additional permission to access the camera.

Unlike many other apps, this app doesn't fetch a verification code from an incoming SMS, but instead sends out an SMS for phone number verification. For some users this is confusing as they keep on waiting for a verification SMS.

For users who already have set up their UPI accounts it will automatically connect the app with the bank account. For others, the app lets the user choose one from the list of participating banks and then they need to set up their UPI pin.

It includes a dual-layer of security with a passcode in addition to the UPI PIN. But chances are many users will end up choosing the same number for both. The UPI PIN can be easily created/reset from the screen that appears on clicking the bank logo on the home screen. But even within this simple interface, I couldn't locate an option that will let me change the passcode.

Payments can be made to a mobile number or an UPI address. The default is mobile-number@upi (for example 99XXXXXX00@upi) and the app also allows users to choose a custom payment address such as yourname@upi. And like most usernames, it is first-come-first-serve.

BHIM app in action

The Glitches

However, in our tests we found that while money sent to UPI addresses with a mobile number worked seamlessly, all attempts to transact with a custom UPI address couldn't get through. Also the transactions don't happen as fast as they claim.

There have been reports of app freezes and "device binding failed" errors. Some users say their back button don't work.

BHIM is not only to make payments but to receive them too. It also lets users generate QR codes (quite like the ones that we see merchants accepting Paym put up) by scanning other can send them payments.

It also includes a feature to request payments from others stating the amount requested and with an expiry date for the request. Requests can also be saved for the future.

Should Paytm be Afraid of BHIM?

This no-frills payments app could pose a challenge to other payment services such as Paytm. BHIM promises to be cross platform allowing users to pay to other who are not on UPI. Also the transaction limits (maximum of Rs 10,000 per transaction and Rs 20,000 within 24 hours) are more flexible than that for the other apps.
BHIM's big advantage is that it is government backed and the money is transferred directly from bank account to bank account without an intermediary.
The Paytms, the MobiKwiks, the FreeCharges give benefits such as cashback which BHIM doesn't and this little advantage could help them stay in the game.

While the BHIM app is free, all transactions aren't. Banks might levy a small fee in the form of UPI or IMPS transfer fee, depending on the transaction made.
Even though for an app that has just been launched, some of the processes - such as verifying an user or making a payment - took us much longer than expected. Also the lack of on-screen confirmations confuses. All messaging happens as notifications, which adds additional steps and also increases the chances of a users failing to notice them.

This are early days for the app and more features and improvements are expected soon.

The USP of the app is its simplicity and it might make cashless payments more appealing for more people if the little creases are ironed out soon.

List of banks on BHIM: Allahabad Bank, Andhra Bank, Axis Bank, Bank of Baroda, Bank of India, Bank of Maharashtra, Canara Bank, Catholic Syrian Bank, Central Bank of India, DCB Bank, Dena Bank, Federal Bank, HDFC Bank, ICICI Bank, IDBI Bank, IDFC Bank, Indian Bank, Indian Overseas Bank, IndusInd Bank, Karnataka Bank, Karur Vysya Bank, Kotak Mahindra Bank, Oriental Bank of Commerce, Punjab National Bank, RBL Bank, South Indian Bank, Standard Chartered Bank, State Bank of India, Syndicate Bank, Union Bank of India, United Bank of India, Vijaya Bank.

M_Joshi · Post by **M_Joshi** » 01 Jan 2017 14:32

It seems to me that Modi's main focus are gareeb, pichhde & dalit. His every speech is incomplete by their mention. It's fine & yesterday's schemes targeting them & MSMEs are also fine, but what about the salaried middle class which has been solidly behind Modi? He started by saying that honest people will be rewared but I'm sure there are honest people in this country beyond senior citizens, pregnant women, farmers & MSME owners. Millions of people belonging to this class were hoping IT slab cuts especially by the trial balloon floated about new tax slabs only to be taken aback by the absence of any such measure in Modi's speech. GST is being delayed, work on the 4 lane road in my town is still to start after 2.5 years, no relaxation in IT rates, etc.. Maybe we all have too much individual hopes from the guy.

/rant off.

pankajs · Post by **pankajs** » 01 Jan 2017 14:48

Salaried middle class is famous majorly for sitting on its musharraf during elections. Salaried middle class is a small portion of the electorate and Modi can keep winning on the back of *gareeb, pichhde & dalit* if he can get them on his side.

/rant off

Start of the innings is not the end of the innings. Lots of folks, especially in the chattering class some knowingly and some unknowingly, make the same mistake with black money too. They ask if black money is wiped out now that we are past 50 days of notebandi.

Yagnasri · Post by **Yagnasri** » 01 Jan 2017 15:07

We need to see what happens in this year Budget proposals. Some serious structural support for e-transactions just a massive increase in the hardware required for an efficient network, tax concessions for banks, etc. on e-payments, etc. is needed ASAP. Hopefully, Jetlee delivers this time. But seeing him doing his rubbish for the last two years, we can not expect much from him. I seriously doubt he even gives some good IT rates even this time.

Subdas · Post by **Subdas** » 01 Jan 2017 15:29

All salaried people should resign and re-join as contractor and then file 16(a) and show profit of business only 40% and in that process the entire pay will become almost tax free. Why keep on getting a fixed pay and then get hit by 30% tax which is world standard by the way!

chetak · Post by **chetak** » 01 Jan 2017 15:51

Yagnasri wrote:We need to see what happens in this year Budget proposals. Some serious structural support for e-transactions just a massive increase in the hardware required for an efficient network, tax concessions for banks, etc. on e-payments, etc. is needed ASAP. Hopefully, Jetlee delivers this time. But seeing him doing his rubbish for the last two years, we can not expect much from him. I seriously doubt he even gives some good IT rates even this time.

no fireworks this year, I think.

all will be reserved for 2016 budget where it will make more practical sense

Prasad · Post by **Prasad** » 01 Jan 2017 16:13

Well SBI just dropped .9% in interest rates todin. Calculate reduction in emis on your home and auto loans you people.

anandsgh · Post by **anandsgh** » 01 Jan 2017 16:32

Prasad wrote:Well SBI just dropped .9% in interest rates todin. Calculate reduction in emis on your home and auto loans you people.

Saari, that is only for new applications, older loans not changed with new rate. Please let me know if anybody got their decreased.

Yagnasri · Post by **Yagnasri** » 01 Jan 2017 16:43

Personally, I may be taking an HL shortly. So some benefit for me.

My mango views:

Home prices are going to increase a bit in the main cities if builders are ready to lower the costs. But most of the Builders are already sitting on overpriced inventory in the main cities like Mumbai and Delhi, and they are not going to start a trend of lowering the prices unless they are under pressure from their lenders and "investors". Since in many cases, the "investors" are mainly political leaders and big moneybags who are primarily looking for parking their ill-gotten BM they may not want to reduce the prices unless they are under pressure themselves. Moreover, there is not going to be many purchases for "investment" purpose now. Such a reduction of the rate of interest, therefore, may not stimulate demand to a large extent now.