The process of exchange of Rs.2,000 notes into currencies of smaller denomination has begun. A maximum amount of Rs.20,000 or ten Rs.2K notes can be exchanged in a single transaction. Persons exchanging Rs.2K notes need not have bank accounts and need not disclose their identities. The process will go on till 30 September and any residual Rs.2K notes will remain legal tender even after this deadline. The anonymous conversion of big notes in any amount will thus invite no scrutiny.
The process sounds quite hassle free compared to the chaotic and traumatic experience of the original ordeal of demonetisation nearly seven years ago? Shall we then call it a smooth mini demonetisation with the government learning its lessons from the chaos and hardship inflicted by the earlier episode? Just pause and think again.
It is common knowledge that for quite some time Rs.2K notes have nearly disappeared from circulation. Fresh printing of Rs.2K notes stopped long ago. Yet, every time we hear of major cash recovery through ED/IT/Lokayukt raids we could see huge stashes of Rs.2K notes. We can safely say that this big denomination note has become the most favourite unit for hoarding mega cash. And it is quite likely that such hoarded cash is actually black money accumulated through loot and illegal earnings.
Cheerleaders of the Modi government are calling it yet another masterstroke. A certain BJP leader from Bihar with the Modi surname is celebrating it as a second surgical strike on corruption and black money. Others are calling it routine retiring of a note of large denomination after it has served its purpose.
What really was this purpose? In the initial phase after the banning of Rs.500 and Rs.1K notes, the Rs.2K note served as a stopgap currency to replace the banned notes. But this purpose had been over soon after the restoration of Rs.500 notes and sufficient supply of smaller denomination notes like Rs.200 and Rs.100. The real purpose has been to facilitate big cash hoarding and big transactions.
And now this conversion without any restriction or scrutiny will actually facilitate a wholesale whitewashing of hoarded black money. The inconvenience that ordinary Indians having some residual amount of Rs.2K notes, especially people in small business and agriculture, will suffer in the process will be an added insult to the injury inflicted by the original ordeal.
The retirement of Rs.2K notes does not undo the farce of demonetisation, it only confirms and compounds the original Modi-made disaster. Time to retire the wholesale producer of #MoDisaster to stop this periodic retail delivery.
