From barter to cash: Bane or boon?

Indrasena Reddy

Prof Kancharla Indrasena Reddy

Blessed are our ancestors who never imagined the need for cash during their times. Later on, the march of history drove them to the stage of barter economy. Now the entire world is in the clutches of cash from which there is no escape for anyone. Perhaps, a terrible evil entered the world in the form of cash. The ‘demonetisation’ move announced by Prime Minister Narendra Modi on November 8, 2016 gave the Indian economy and the country’s 127 crore population a big jolt. The problematic demontesiation has been a topic of discussion and debate all over the country since November 8.

Our Parliament is seized of the problem during its entire winter session without a solution in sight. The issue has multiple new dimensions as it touches the life of everyone whether one is fabulously rich or a neglected pauper. Most of the discussants of the problem so far have been able to marshal all their rhetorical skills in denouncing demonetisation. It is interesting to note that a number of people are appreciative of the intention of demonetisation although they are critical of the programme’s implementation. So far, most of the intellectuals turned out to be antagonists of the project ‘demometisation’. However, one wonders if there is also a glimmer of hope in a dormant state in the belly of demonetisation. This aspect has not attracted much attention so far.

The Prime Minister seems determined to take the issue to its logical conclusion. Initially, he sought to explain to the nation that the currency bills of RS 500 and Rs 1000 will no longer be a legal tender from January 1, 2017. Initially, the Prime Minister hinted that demonetisation is meant for fighting black money, fake money and corruption to eliminate terrorism and extremism. However, later on, one can discern a shift in his stand which focuses on the transition of the economy from cash to the cashless mode.

In India, 90% of financial transactions are through the medium of cash and 86% of cash circulation is in the form of notes of Rs 500 and Rs 1000. Sudden withdrawal of such a facility and the absence of adequate supply of cash through banks and ATMs disoriented the lives of people in both the organised and unorganised segments. Under these circumstances, some of us felt the need for bringing together a small group of people comprising literati and others for eliciting and sharing the problems arising out of demonetisation.

Demonetisation debate has been a province of the privileged classes so far. Our attempt is to break this barrier in order to open the doors of the debate to the marginalised sections of the people like home makers, small traders, farmers and taxi/auto drivers. An integrated approach to the problem is imperative in this context to ascertain whether the demonetisation is bane or boon.

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