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DYNAMISM(E)

#ISMEianWrites

BALAJI R
PGDM 2015-17

DEMONETIZATION - A CHALLENGE & PRIDE FOR INDIA

Pr

overbs are easy to read, difficult to realize until it’s been experienced in a situation.
“The less routine the more life” was one proverb to be experienced from late evening
of Nov 8,2016, when legal tender of Rs.500 & 1000 currencies were withdrawn. This
was part of a larger strategic plan to integrate national economy. Prior to this, government of
India had implemented demonization of high currency notes twice (1946 & 1978). This was
the first of its kind in 21st century. This defined the approach & strategy of our governance in
curbing black money transactions, fake currency circulation, path to cashless economy, restructuring & recapitalizing our monetary framework, eradication of corruption and digital
revolution. After the announcement was made, ATMs became holy places with prayers for
cash availability, which marked a tougher economic journey towards transformation, that
Indians were headed to.
Post-independence, India had sailed through many unbreakable situations from wars
to drought, terrorism to scams, LPG (liberalization, privatization, and globalization) to
NPAs, but the demonetization fell into a completely different genre. The cause and effect were
both emerge from within the country that have been widely influenced, triggered and protocoled by outsiders on all the aspects. As we are integrating and advancing into globalization,
every decision is significant in shaping our destiny. It is important to see demonetization from
a wider perspective. A broadened horizon will reveal a strong context for such a move with a
primary objective of formalizing the informal sector which contributes 20% of GDP & 80% of
employment.
The following list can throw some light on
few important economy reforms & measures that
emphasize India’s significant progress among
emerging economies in last two decades:
Following this, we are moving towards a
remarkable journey where the government is optimistic that an individual can open a bank account
in less than 30 seconds, acceptance of smart card
in all public services and efficient single window
policy system and GDP growth rate at 8.5-9.5%
by 2020 and possess direct impact on our ease of
doing business ranking to improve below 100.
We are placed at a highly energizing situation and it’s too early to make a conclusion
of demonetization of being success or failure. Our monetary & fiscal policy frame work for
FY2017 derives a pattern of many hypothetical questions.
The main role and responsibility of government is to secure confidence of citizens &
ensure that tax money paid had been effectively utilized and create an awareness of digital
payment mode from small vendors to pioneers in real estate business. Hence training and development is key metric since change is not agile as far as unorganized sector is considered.
However, one thing is sure- unfolding of this “demon” (-etisation) will go far beyond the economy. It will have an all-encompassing impact on social and political life of this country.