Currency Demonetisation and Future course of Indian Economy

ShauryaT · Post by **ShauryaT** » 04 Dec 2016 05:18

For Demonetisation to Work, Modi Must Root Out Political and Bureaucratic Corruption

Like dominoes

All these five positive outcomes, however, depend crucially on whether this first step of demonetisation is followed by others that are aimed at rooting out political and bureaucratic corruption. These are the fountain-heads of black incomes and also quite often the principal cause of honest businessmen resorting to corrupt practices. The prime minister has, on several occasions assured on this count and one hopes that these assurances will be honoured. Some steps have already been implemented. These include, making the industrial licensing system more transparent and less discretionary; implementing the GST; linking bank accounts to Aadhaar; making Aadhaar and pan card numbers compulsory for large value purchases; the passing of Benami Property Act and its early implementation etc. All these will surely make the generation of black and illegal incomes more difficult in future and reduce the space and scope for the parallel economy.

One warning. The government has to ensure and assure the people that they will not be hounded and terrorised by the income tax bureaucracy that may see itself as having been doubly empowered. Some ominous signs of this ‘taxman’ overreach and harassment are already visible. Apprehending culprits and money launderers will have to be done most cautiously and with due care for not harassing the professionals, common businessman, traders and entrepreneurs. Prime Minister Modi must make it clear to the income tax officials that it is only a simple, rational and non-threatening tax process that engenders much-needed taxpayers’ confidence in the system. Taxpayer cooperation will not be achieved through persistent threats of harassment and exploitation. I am afraid the income tax department has not so far covered itself with glory on this count. On the contrary, stories of their patently unacceptable boorish and downright inhuman behaviour during income tax ‘raids and searches’ are legion. This raid and seizure culture and practices must change if we are to become a civilised and honest society, which successfully eliminated the pernicious illegal economy.

Simultaneously, measures will have to be initiated to roll back political corruption that generates black money. The principle cause for this is undoubtedly the need for slush funds for election campaign finance. Many solid suggestions to curb and root out the need for black money for financing election campaigns have been made including most recently by B J Panda, a BJD MP. The prime minister has all the wherewithal to implement this critical change as well. He has near total control over this own party; has a large majority in the Lok Sabha and the BJP could have a sizeable presence in the Rajya Sabha after the next round of provincial elections. Modi has also developed a strong direct connect with the people to whom he could appeal to overcome any political resistance to his proposals to make election campaign financing more transparent and accountable.

If these two critical steps of reigning in the income tax bureaucracy and cleansing the election campaign process are implemented, Modi will certainly usher in the golden period in India’s economic development. We will become attractive for both domestic and foreign investors with a relatively corruption free environment that offers predictability and accountability. It will provide the positive encouragement for honest workers and professionals who will not see themselves as constantly lagging behind their corrupt peers. India could regain its ethical and moral elan. A golden period for the Indian economy could then ensue and see the economy achieve double-digit growth for a sustained period.

Without these follow-up measures, I am afraid, a great opportunity would have been wasted. It would then be difficult for Modi to counter the charge, currently being hurled at him by those who oppose this move, that demonetisation with all its attendant pains and disruptions was not undertaken for serving national interest but instead to serve some narrower political and personal agenda. I am convinced that Modi, who knows the score all too well, will not let the down the common Indian who has supported him despite the pain and inconvenience he has suffered in the wake of ‘currency surgical strike’ on 8/11.

The author is Founder Director at Pahle India Foundation and Senior Fellow CPR, Delhi.

Rishirishi · Post by **Rishirishi** » 04 Dec 2016 05:31

Lilo wrote:The days are numbered for all the "proudly" tax avoiding mercantalists - when the triple whammy of GST,DeMo & Cashless hit them together going ahead.

Then they have to truly emigrate to dubai or shanghai to still keep their business in cash & off the books.
Or they may stay here & adopt a hawala system of payments where gold here is exchanged for USD abroad - while continuously looking across their shoulders ever vary of the govt agencies like the common criminals they are !

The Business community are the heart of the Indian economy and growth. They work very hard and manage to put money to use where it creates most wealth. They are big spenders and create employment. They would be very happy to opperate in a clean, fair and regulated environment.

The problem is the corrupt officials. Firstly they create a system where businesses end up paying huge bribes, a lot of which is hidden way and lost to the economy. Second problem is that they make it impossible to opperate in a leagal way. How do you run your factory if competition is not paying tax or following regulation ? How do you opperate in an environment where competition can outcompete you by paying bribes. Running business leagally is impossible in India.
A cashless economy, simpler regulation and more digitalization will definately help in reducing the corruption. But how do you mange large infrastructure projects, where quality inspectors are bribed.

You want to fix corruption start with the government officials, start with lokpal. start with making is very dangerous and hard to be corrupt. This demonization business has costed 12 000 crores. What if the government in stead hired 50 000 inspectors to catch government officials. Tap their phones, e-mails, put CID on them and put them in jail for 5-10 years.

Marten · Post by **Marten** » 04 Dec 2016 09:39

True, the timely introduction of measures to reduce physical interfaces between the public and Govt servants will help reduce corruption. SLAs and penalties including new provisions for jailtime will help motivate the corrupt amongst govt employees to reduce their activity. However it is unrealistic in India to expect things yo improve overnight. This might be NaMos last term so I hope he pushes through reform and cleans up at least tendering and payment processing. In my experience the IRS and IPS cadre are beyond redemption. A few are honest but the system is set up to fleece the public and enrich these few in power. How power is wielded needs to change first. RTOs and Municipal services/contracts need to be targeted first. Make an example of a few and ask others to clean up or else...
PS: Idealism and hope apart, am told most large operators in RE have found legal means of converting BM. They are sitting pretty, and prices are not yet low due to the hope that loans will get cheaper and demand will boom. In effect tax evasion will continue with new measures and currency in place until the penalties are much more harsh.

durairaaj · Post by **durairaaj** » 04 Dec 2016 09:42

We are not sure if the origin of corruption is business people or executive machinery or the political parties. But there is some truth in what TKiran and Rishirishi are saying.
Instead of maligning corrupt business practices the next steps should focus on how to improve the compliance part. There are so many unnecessary taxes and impractical regulations. the current status is due to the kicking the can down the line instead of addressing the issues rightaway. When there is a way, any trasaction will occur through the least resistant of the paths. The government should make laws and regulations less stringent and give lesser discretionary powers to bureaucrats in socially good transactions, But make stringent laws on socailly. bad transactions such as drug, violent crime, white collar corruptions and scams and severe punishments to the bureaucrats caught in corruption.

Unless it is done all the gains from this huge exercise will go to waste. I hope the government knows this and acts on it.

Schmidt · Post by **Schmidt** » 04 Dec 2016 09:54

Spot gold rates now :

Price in US :

Live Metal Spot Price (24hrs)
Dec 03, 2016 at 23:11 EST
Gold Spot Prices Today Change
Gold Price Per Ounce $ 1,180.44 2.34
Gold Price Per Gram $ 37.95 0.08
Gold Price Per Kilo $ 37,952.03 75.23

Price in Chennai :

Date : 03/December/2016
Pure Gold (24 k)
1 grm : 2890.00
Standard Gold (22 K)
1 grm : 2762.00

37.95 USD = 2581 INR

There is a 11% differential in Pure Gold

vina · Post by **vina** » 04 Dec 2016 10:12

durairaaj wrote:We are not sure if the origin of corruption is business people or executive machinery or the political parties. But there is some truth in what TKiran and Rishirishi are saying.
Instead of maligning corrupt business practices the next steps should focus on how to improve the compliance part. There are so many unnecessary taxes and impractical regulations. the current status is due to the kicking the can down the line instead of addressing the issues rightaway. When there is a way, any trasaction will occur through the least resistant of the paths. The government should make laws and regulations less stringent and give lesser discretionary powers to bureaucrats in socially good transactions, But make stringent laws on socailly. bad transactions such as drug, violent crime, white collar corruptions and scams and severe punishments to the bureaucrats caught in corruption.

Unless it is done all the gains from this huge exercise will go to waste. I hope the government knows this and acts on it.

The problem fundamentally with India, is that India went down the road of instiutionalised corruption with the dawn of the license permit raj. So really the "Nehruvian Socialism" is what created this corruption. Insanely high tax rates, shortages, licensing, permits, quotas, etc. etc all in the name of the poor of course, create this monster. The politicos loved it of course. It gave them huge power and afforded opportunities for massive corruption.

Look at WHERE in the economy today you still have huge entrenched corruption. All of those will be areas where there are big govt touch points, either locally or nationally. Real Estate, zoning regulations, licenses (even something like a driving license), clearances (environmental and others), and of course public contracting where the govt actually hands out cash (like irrigation projects, public works etc.. etc). In UPA, the corruption was in mostly "liquid" minstires (telecom, coal, power, railways etc. etc).

Yes. Narasimha Rao made the biggest dents against corruption when he dismantled industrial licensing and the quota Raj. But the follow on steps never came through. You NEEDED GST (which Modi as the CM put a spoke into , yeah. yeah, I know, it is difficult to accept, Modi as CM was PRO corruption in an indirect way), you needed massive reforms in the architecture of the state etc.. etc. You needed clean contracting models, you needed massive reforms in the way money flowed (that is happening now), you needed huge reforms in factor markets (land, labour, capital), that are still work in progress (land is probably going to be freed now with this Benami bill and the targeting of Benami holdings that are sure to come). Labor again, huge changes needed, there is massive whole scale cheating in labor in terms of pay , benefits, taxes etc (think plantation, transport, f&B, construction ) and on top of all that, you have political and bureaucratic corruption. The entire system was corrupt top to bottom, right from horse trading of MPs/MLAs/Rajya Sabha seats down to getting a job as a chowkidar with the govt.

Suraj · Post by **Suraj** » 04 Dec 2016 10:28

Goldprice.com data currently shows per gram rates:
INR 2574
USD 37.84
AED 139

About the same. For what it's worth prices range from Rs.2886 in Kerala to Rs.3005 in Ahmedabad and Rs.3015 in Chandigarh. That's a 4.5% spread between just different parts of the country. This is a supply and demand thing. Gold demand in general is higher than US and there are localized demand differences that account for nearly half of the premium.

ShauryaT · Post by **ShauryaT** » 04 Dec 2016 11:01

To add to Vina:

If our PM needed a dhamaka and a game changer, I would have rather have him announce that a public servant shall no longer be allowed to own wealth in their person or family name beyond a certain amount and if held, it shall be confiscated. Mandatory wealth filings for all public servants (waiving the annual Rs. 50 lac limit). Fast courts to prosecute public servants charged of corruption. The onus of being "innocent" for public servant to prove. At root this entire game of being in government service as it provides life long employment with pension and opportunity to leech the public has to get a body blow. This is one area, if executed upon, I will cheer from the roof top and a definite signal to one and all that the Nehru led framework is gone for good. Disinvestment in addition would be nice. The only way to change the fundamental nature of the government in India is to starve the beast and make government service unattractive to folks who want to join it under the Nehru presumptions. Last but not the least devolution of power. India really cannot be ruled by Delhi. We as a people are way too independent to follow its diktats.

Chandragupta · Post by **Chandragupta** » 04 Dec 2016 11:34

@tufailelif

I am reaching a conclusion that Modi Govt is seeding a Nehruvian-style socialist government, bigger than USSR.

Sicanta · Post by **Sicanta** » 04 Dec 2016 12:08

Chandragupta wrote:@tufailelif

I am reaching a conclusion that Modi Govt is seeding a Nehruvian-style socialist government, bigger than USSR.

What is it with demonetization that is causing khujli to so many nationalists, in this case on twitter? They see a few incidents here and there and take it to be the general rule. And ones who have actually conducted surveys on the ground are paid no attention.

Subdas · Post by **Subdas** » 04 Dec 2016 12:17

simple. there are many black faces behind the garb of nationalism.

Subdas · Post by **Subdas** » 04 Dec 2016 12:20

white business are evolving to support cash less purchases. Now medical shop in my vicinity is offering credit to be paid off by a card at a later time since the card machine was not working. This model can be/is being easily adopted by mango people to pay for their vendors by using the large 2000 note against a credit line.

Subdas · Post by **Subdas** » 04 Dec 2016 12:24

I heard a number of people arguing is that while all this good, the poor are going to bear the burnt. The only reason mago people may bear the burnt is when they live on black economy. But then u cannot say that we will not burst black money because it employs a lot of innocent mango people. By that assertion we cannot burst the terror network either as a lot of innocent people live on it!

Chandragupta · Post by **Chandragupta** » 04 Dec 2016 12:31

Haha now Tufail Ahmed has BM? Do you even know who he is? Let us not become AAPtards, where we cannot tolerate any criticism. I think Tufail's criticism is justified. See his TL. Have you stood in queues? I have and people are not happy, that they still do not abuse Modi tells us the kind of goodwill Modi has.

But it is a fact that a lot of BM hoarders have got away due to leakages in the system and atrocious implementation. And people are suffering due to lack of cash, contrary to the opinion here where apparently everyone is happy and celebrating diwali each day.

Take his moradabad speech, he says the poor should keep the 2.5 lakh that any BM hoarder has put in their accounts. Is everyone okay with this? I would like to know if the people here agree with this. Doesn't this money belong to the taxpayers like us? Would this robinhood like populism attract the same support if this was done by Kejriwal and Congress?

abhijitm · Post by **abhijitm** » 04 Dec 2016 12:42

Its a gift given to them by someone so they can keep it. I have no issue with that.

Picklu · Post by **Picklu** » 04 Dec 2016 12:47

Chandragupta wrote: Take his moradabad speech, he says the poor should keep the 2.5 lakh that any BM hoarder has put in their accounts. Is everyone okay with this? I would like to know if the people here agree with this. Doesn't this money belong to the taxpayers like us? Would this robinhood like populism attract the same support if this was done by Kejriwal and Congress?

I do support this. .

In fact, I proposed the same on this very thread that let all the people having JDY keep 50% of the BM placed in their account in case of a whistle blower comes forward and helps prosecute the original BM holder. This is practical as otherwise
a. the sole whistle blower keeping the money becomes the target of the goons of BM holder and also
b. the other JDY account holders who are social peers of the whistle blower start acting against him because their interests are now at cross purpose.

On the other hand, allowing ALL to keep 50% or more will enable them to gang up against the original BM holder and come forward to provide more and more info to the prosecution.

A large part of tax payer money goes as subsidy to the poor and downtrodden. These are the very same people who have JDY. Let them keep the BM - fully or at least 50% of it. Consider it one more subsidy program for the poor.

If the NaMo govt wants, they can even give a name to this - Pradhan Mantri Anti Corruption Yojana. The beauty of it - it does not cost a single paisa to the exchequer while being the ultimate subsidy program; giving to them who needs the most from them who didn't really earn it

Akshay Kapoor · Post by **Akshay Kapoor** » 04 Dec 2016 12:50

Moradabad speech was brilliant. Sheer genius. I have been a modi critic on administrative issues (IAS reform,police reform etc) and defence reform and the way armed forces are treated. I have written letters to PM and Arun Shourie on some of these issues. However demo and Moradabad speech have changed my mind on at least his vision and intentions.

Its not a question of redistribution - its a question of pragmatism. The BM hoarders use poor people to deposit their money. Fine, they give power to the poor. All Modi is saying use that power to discourage them to do this. Power is now in poor's hand. Don't return the money to these mofos. So what should the mofos do ? Don't use the poor to deposit the money. Simples. The sytsem is corrupt as a lot of esteemed members have pointed out. This is a brilliant brilliant way of fighting it. Enlist the poor and use basic human behaviour to do it.

I still think massive administrative reforms are needed. One cornerstone has to be abolition of these all India services, getting ex servicemen into them etc etc. But that is a much bigger deal than demo - they will be up in arms and the country will grind to a halt.How do you take on an entire system - by bypassing it and going to the people - thats what he is doing.

He is as free market and capitalist as Sardar Patel. Don't worry.

I still have questions on why 2000 Rs was introduced and why not just get a 250 Re note instead of 500 and 2000 ? Why didn't we spend more effort in building a cashless infrastructure, why werent cctv camersa put in banks and why don't we have an army of committed people and a control room to address and intervene in the hour to hour situation. But that's fine. This is like war - planning could have been better, tactic could have been different but you need to constantly adapt in conatct with the enemy. Ultimate goal is to win and all energies have to be focused on winning not wasting energy in questioning everything.

Manish_Sharma · Post by **Manish_Sharma** » 04 Dec 2016 12:54

Akshay Kapoor wrote:
Karan M wrote:This guy doesnt want to pay tax in India but will pay tax to China. He is bragging about evading customs by mixing his gold with chinese coins. And then he is bragging about not paying tax.
And moderators - maun !! Deafening Silence.

Being a think tank moderators are right to allow him; in fact all these "demonetization is nothing but a failure" OR "BM holders have found a way, which I know as they are in my relations" have been thoroughly proven wrong.

Everytime somebody brought these fancy theories Sarvashri Suraj, Disha, Vina have brought their technical and academic knowledge to discredit their theories and ideas. Those brilliant posts were generated due to these plastique-dharmics people.

So letting them post is good.

Those posts on my dozen FB accounts are bringing lots of light to "Real Dharmics" in fighting the termite army !

Jai Ho !!!

habal · Post by **habal** » 04 Dec 2016 13:07

Some while ago, I came to the conclusion that human beings on earth are not on a pleasure trip instead this is some kind of punishment for some past crimes that one is forced to take birth here rather than in better world or other planets which may have have far fairer playing field. Here on earth everything is skewed and nothing is rational and those who have power almost always abuse it.

TKiran's logic stands to reason in peculiarly Indian sense, if he can be tight in bribing an IT officer but instead can do langar and social service to help feed a few hundrex people every month or every fortnight. The gurudwara langar seva by wealthy is the best service one can do in this nation until laws and rules can be made transparent and user-friendly. Imperfect laws only help corrupt people and do zilch for nation. TKiran types cannot rest easy that they are right and have done everything and there is nothing more to do. Contentment is enemy of dharma in an imperfect society. Thus he has to constantly improvise and find new ways of providing seva. This way in eyes of God atleast, he will be someone who tried his best. This is my take

prashanth · Post by **prashanth** » 04 Dec 2016 13:10

Chandragupta wrote:Take his moradabad speech, he says the poor should keep the 2.5 lakh that any BM hoarder has put in their accounts. Is everyone okay with this? I would like to know if the people here agree with this. Doesn't this money belong to the taxpayers like us? Would this robinhood like populism attract the same support if this was done by Kejriwal and Congress?

Saar, would you have the GOI take away money from JDY accounts? How can you tell between ill gotten money and genuine deposits? If GOI proceeds with this idea they will be called tyrants or worse.
That money doesn't belong to any of 'us' but to GOI. In this case, monetary liability of GOI got transferred from hoarder to those with PMJDY accounts. GOI should now withhold DBT subsidies (for a while) to those JDY accounts that saw deposits after Nov 8, unless they come forward to prove it was not BM.

Chandragupta · Post by **Chandragupta** » 04 Dec 2016 13:13

I don't have a take on it that is why I asked for opinion.
But I have said in the past that instead of giving anything for free to the poor, use the money to build rural infra. The man and the fish story etc etc.

rahulm · Post by **rahulm** » 04 Dec 2016 13:14

In Gurumurthy's lecture linked on page 91, he calls DeMo 'Financial Pokhran'

For the non Tamil people, Any chance anybody can post a brief summary of his answers in Tamil, particularly on the Rs 2000 note ?

Thanks

Akshay Kapoor · Post by **Akshay Kapoor** » 04 Dec 2016 13:18

prashanth wrote:
Chandragupta wrote:Take his moradabad speech, he says the poor should keep the 2.5 lakh that any BM hoarder has put in their accounts. Is everyone okay with this? I would like to know if the people here agree with this. Doesn't this money belong to the taxpayers like us? Would this robinhood like populism attract the same support if this was done by Kejriwal and Congress?
Saar, would you have the GOI take away money from JDY accounts? How can you tell between ill gotten money and genuine deposits? If GOI proceeds with this idea they will be called tyrants or worse.
That money doesn't belong to any of 'us' but to GOI. In this case, monetary liability of GOI got transferred from hoarder to those with PMJDY accounts. GOI should now withhold DBT subsidies (for a while) to those JDY accounts that saw deposits after Nov 8, unless they come forward to prove it was not BM.

No, don't even do that. Say vote for BJP and we wont ask for the money back and we will enusre that other poeple (the benami or orginal depsoitor) does not get it too - we we will protect you. Brilliant ! The BM hoarder has just paid for the election win. Slam bam, thank you mam.

Chandragupta · Post by **Chandragupta** » 04 Dec 2016 13:19

habal wrote:
TKiran's logic stands to reason in peculiarly Indian sense, if he can be tight in bribing an IT officer but instead can do langar and social service to help feed a few hundrex people every month or every fortnight. The gurudwara langar seva by wealthy is the best service one can do in this nation until laws and rules can be made transparent and user-friendly. Imperfect laws only help corrupt people and do zilch for nation. TKiran types cannot rest easy that they are right and have done everything and there is nothing more to do. Contentment is enemy of dharma in an imperfect society. Thus he has to constantly improvise and find new ways of providing seva. This way in eyes of God atleast, he will be someone who tried his best. This is my take

TKiran ji's logic seems quite a different place to me but I do understand some of his points that many here seem to miss. IT vity fellas here think that if a businessman pays bribe, he must be evading taxes but what they do not understand is many businesses in India pay proper taxes filed via CAs and yet have to shell out bribes to IT guys, excise, sales tax, fire department, police, custom and what not. And if you stop the flow of money, someone else will get your business while you wonder where the next meal is going to come from.

Sicanta · Post by **Sicanta** » 04 Dec 2016 13:26

Chandragupta wrote:I don't have a take on it that is why I asked for opinion.
But I have said in the past that instead of giving anything for free to the poor, use the money to build rural infra. The man and the fish story etc etc.

Money deposited in PMJDY Accounts is not a significant portion of assumed BM. Though an amount of 2.5 lakh crore is not going to come back, according to sbi. That plus deposits over 11 lakh crore has entered the banking system till 1st Dec. And the demonetization drive is yet to end (the main reason i object to terming the drive as a failure right now). So there will more than enough funds for infrastructure.

And surveys show that there is more than enough support.

Akshay Kapoor · Post by **Akshay Kapoor** » 04 Dec 2016 13:28

^^ This is true. I have filed completely clean returns and still had to pay a 'facilitation payment' a couple of years in a row. In the second year I discovered that the CA was palming most of it. But it is precisely this scourage of small businessman (the corrupt system) that is being treated.

And followed by less discretion and less contact with govt authorities - all that means less govt and more liberalization and that will happen.

prashanth · Post by **prashanth** » 04 Dec 2016 13:28

Chandragupta wrote: But I have said in the past that instead of giving anything for free to the poor, use the money to build rural infra. The man and the fish story etc etc.

True. But in the longer run, they should try their best to stop generation of BM itself and I believe GOI is on the right path. Push towards cashless economy is one step. Gradually, they ought to phase out 2000, 1000 and 500s completely. They were forced to introduce Rs 2000 and new 500 to deal with sudden invalidation of 85% value of cash as on Nov 8. Testing times these are. We can only wait and watch.

habal · Post by **habal** » 04 Dec 2016 13:34

Long time ago when I used to have VAT TIN # I used to regularly get letters from sales tax office with this heading

Alert: Bogus transactions recorded, you have comitted bogus transactions and are in violation of xxx laws.

In reality though, nothing actually had happened. I didn't sell a single item yet that month to pay tax to ST for that month, this letter was received for particular month. For all stuff I bought I paid tax already. So where is the problem.

there was no problem, only ST guy made a call thinking I would give him somehing. Usually conversation used to end in gaali-galoch or threats. Fed up with this constant harassment and abuses, I stopped that particular occupation too not long after.

Gus · Post by **Gus** » 04 Dec 2016 13:38

it is quite easy to claim 2.5 lakh income. It will be very tough to prosecute somebody ..hence the modi tactic of not confronting the poor but to see if the JDY guy can confront the BM guy.

Manish_Sharma · Post by **Manish_Sharma** » 04 Dec 2016 13:52

durairaaj wrote: The government should make laws and regulations less stringent and give lesser discretionary powers to bureaucrats in socially good transactions, But make stringent laws on socailly...

Unless it is done all the gains from this huge exercise will go to waste. I hope the government knows this and acts on it.

I think NaMo govt. will tackle the bureaucracy much later after taking their help in implementing other policies like Demonetization, Benami & gold etc. If they had touched the bureaucracy in the beginning, they'd have sabotaged even more. Hence govt. even had to bribe them by passing laws that protect them from prosecution without central govt's permission. Probably second term.

Suraj · Post by **Suraj** » 04 Dec 2016 14:07

South China Morning Post is the main newspaper of Hong Kong:
SCMP: India's Modi has guts - if only Hong Kong could have some of it

Far be it from me in my Hong Kong high tower to judge what is really happening there but I will say what Modi has done takes a lot of guts, conviction and political will. He is apparently ready to put his money where his mouth is about tackling corruption on this scale. It’s been a while since India has been led by someone with this kind of vision and conviction. Whether it will end up destroying him politically or build him a stronger mandate, respect is due to the man for his decisive leadership.

You can forget about that kind of leadership here in Hong Kong, with the chief executive election just a few months away. Of course, we don’t have corruption problems on the scale that India has to tackle, but we could certainly use a similar brand of daring governance and willingness to rock the boat to right some of the wrongs in this city.

Rishi Verma · Post by **Rishi Verma** » 04 Dec 2016 14:25

Gus wrote:it is quite easy to claim 2.5 lakh income. It will be very tough to prosecute somebody ..hence the modi tactic of not confronting the poor but to see if the JDY guy can confront the BM guy.

Saar, you are thinking / writing in American lingo. It's a civil code issue not criminal. The poor chap (let's say a laborour) will be asked by the bank manager to name the goon who gave him the money else the account would be locked. The guy will start singing and penalties can be levied up the chain. If there are twenty poor chaps naming a big fish, the big fish will have to pay the penalties.

Sicanta · Post by **Sicanta** » 04 Dec 2016 14:31

Can someone please critically analyze this article:

Demonetisation: Understanding the event, impact, narrative and meaning

http://www.business-standard.com/articl ... 175_1.html

Schmidt · Post by **Schmidt** » 04 Dec 2016 14:49

Since last 2 days card swipe machines are either not working or are not connecting to the network , maybe there are too.many transactions creating system overload

Big bazar - at all 6 counters there was a problem with the card machines, then a supervisor came and gave instructions not to give out change for 2000 notes unless bill amount exceeded 1000 at least

Last night same story at a major grocery chain

This is becoming a headache now

Chandragupta · Post by **Chandragupta** » 04 Dec 2016 14:53

Question : How will Modi protect the poor who will be hounded by the BM hoarders and their goons i.e. big politicians? Law and order is a state subject. If Jehadidi of Bengal has put 2.5 lakh in 10,000 JDY accounts, how will Modi protect the whistle blowers from being hacked to death by one of Jehadidi's jehadis?

Gus · Post by **Gus** » 04 Dec 2016 14:54

In massa, there used to be a mechanism to do that 'press card on paper' thing that cab drivers used to carry before the mobile swipe machines. Don't think that such a thing exists in India . Is that a possible solution to jammed lines?

Deans · Post by **Deans** » 04 Dec 2016 15:16

Suraj wrote:Goldprice.com data currently shows per gram rates:
INR 2574
USD 37.84
AED 139

About the same. For what it's worth prices range from Rs.2886 in Kerala to Rs.3005 in Ahmedabad and Rs.3015 in Chandigarh. That's a 4.5% spread between just different parts of the country. This is a supply and demand thing. Gold demand in general is higher than US and there are localized demand differences that account for nearly half of the premium.

There is also a making charge and 1% VAT which can effectively negate any price differential when trying to sell gold purchased from abroad, in India.

SaraLax · Post by **SaraLax** » 04 Dec 2016 15:19

Schmidt wrote:Since last 2 days card swipe machines are either not working or are not connecting to the network , maybe there are too.many transactions creating system overload

Big bazar - at all 6 counters there was a problem with the card machines, then a supervisor came and gave instructions not to give out change for 2000 notes unless bill amount exceeded 1000 at least

Last night same story at a major grocery chain

This is becoming a headache now

I am not facing any of these issues in any of the Nadar community run middle class department stores (many of which have been having POS machines since quite a few years now and also accept sodexho mean vouchers) that i have been going to for my home purchases. Some of them are still accepting the old 500 INR and claim that they can still change it in their PSU bank branches or in some of their co-owned medical shops !!. Also Nilgiris supermarket chain (a recent acquisition of Kishore Biyani - the boring founder of Pantaloon & Big Bazaar chains) and the local Pazhamudir Nilayam are having more rush these days and they claim a larger % of card usage after Nov 8th. No issues with POS machines in these places too.

I recently found that we can seek a LPG cylinder refill & pay for the same - using the online facility in the IOC's Indane website. Happens using the usual digital payment via card/netbanking. Indane LPG also have Android and iOS Apps for doing the same from smartphones !. I was using the IVRS facility of Indane LPG till now & paying nearly 600 odd INR in cash during LPG delivery. Seems this is no longer needed.

Deans · Post by **Deans** » 04 Dec 2016 15:26

Schmidt wrote:Since last 2 days card swipe machines are either not working or are not connecting to the network , maybe there are too.many transactions creating system overload

Big bazar - at all 6 counters there was a problem with the card machines, then a supervisor came and gave instructions not to give out change for 2000 notes unless bill amount exceeded 1000 at least

Last night same story at a major grocery chain

This is becoming a headache now

The problem is possibly that all 6 machines are linked to one line, which only has the bandwidth to handle 1 card being swiped at a time, or has a
ceiling on the amount of data transferred in a month. Outlets have not anticipated a much higher volume of card transactions (and hence data usage).
Also, card machine down time is longer as technicians are busy installing new machines (demand for which has gone up TEN fold, since 8th Nov).

durairaaj · Post by **durairaaj** » 04 Dec 2016 15:28

A tweet below may explain the problem.
Premjeet Singh ‏@_prem_ 49m49 minutes ago

#DeMonetisation impact-POS machine nt working since yesterday.All servers down! Is India's infra really equipped for #CashlessTransactions?
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