My apologies for not publishing any blogs after the last one some time in April 2016.
In fact this year has been much eventful for me. It was the last year of my long professional career extending over 36 years in a government owned company. It is the Steel Authority of India Limited or SAIL in short. Unlike most engineers and professionals in the current IT-era, my generation belonged to an era when engineers and jobs were both scarce and when most of us never ever seriously thought of switching jobs once we got in to one with luck being at our side! Only those rare very ambitious ones from our lot tried switching jobs for betterment! I too remained honestly loyal to the one and only employer which made me sustain so long! It is not true to say that I never tried to leave my original governmental employer. Yes, I too got in to current of exodus to mushrooming private sector of the Nineteen nineties, but could not muster enough courage to do the final act, somehow.
That way fortunately or otherwise, I remained with SAIL all these years from 1980 to 2016. The company gave me opportunity to work in the Bhilai Steel Plant for over three decades and another half decade at Ranchi. I said goodbye to the professional career and shifted to my ancestral home place back in south India in the now urbanized village, Elanthoor, in Kerala.
Shifting residences is not anything easy in India. It is really painful and frustrating in many ways in this country due to several reasons. They are all unavoidable pains in a budding democracy and I do not wish to elaborate on those in this blog. Not continuing with my writing too was due to some of those frustrating obstacles!
Being a citizen who was compelled to shift residences quite frequently in the recent past, I have not been able to exercise my voting power as an adult Indian citizen. I had written about those in some of my blogs earlier. As is the case with several others, I haven't been a blind follower of any political party so far. I liked the government for doing good to the people and disliked when they did foolish things regardless of the political party lines of the government.
The proxy government under the leadership of Dr.Manmohan Singh as the PM in the past ten years has been more of a dislike than any like due to its inability to explain its honesty rightly to the people. Many, including me obviously found lack of leadership, honesty and guts to act when governmental actions were commonly thought as essential.
And that caused many unbiased citizens like me to look for hopeful alternatives and that was how we started developing a liking with the leadership of Narendra Modi, even while we disliked many ideologies and personalities that his political organization embraced.
And that tilt in the minds of the people catapulted Modi to the top seat of power and we expected miracles. But nothing spectacular never happened except the spectacular international diplomatic shows and endeavors of the new PM. The people, including me, did not lose patience. We knew that the new government needed time and experience!
And then the most spectacular thing suddenly happened on the 8th November 2016 night. Very dramatically the PM's face and voice beamed in the millions of household TV screens across the length and breadth of India! The PM announced his ambitious and very daring anti-corruption drive- the now infamous 'demonetization' drive! The government of India was withdrawing two largely circulated Indian paper currencies-the 500 and 1000 rupee notes with immediate effect with certain allowances! New 2000 rupee notes and 500 rupee notes would replace these cancelled currencies in a phased manner!
The PM requested the public to be patient for 50 days and to bear the inconveniences that might arise for this big and bold step by the government to wipe out black money and counterfeit currencies from the Indian monitory system. He explained the restrictions for people to withdraw cash from banks and ATMs.
We danced initially with joy as we found this daring PM taking daring action to clean Indian economy from its black labels! He had earlier taken similar steps to clean the Indian streets from its foul smell that had become the obvious characteristic of the Indian winds!
We were ready to face the odds for making this happen though some of us had our doubts deep in our minds. For example we could not digest the logic of withdrawing 1000 rupee notes with 2000 rupee notes! Yet we never doubted the wisdom of the all knowing government.
As the days went, the Indian people were realizing the great administrative blunder or mismanagement. They were witnessing the lack of planning within the governmental systems and the top bank, the Reserve Bank of India. People like me could not digest the fact that the Indian bureaucracy is so ineffective or unprofessional to handle this kind of a situation which is not in any way a herculean task. How could they do such a big administrative action without proper planning?
Withdrawing most of the existing currencies without making any alternative arrangements to replace those genuine cash? They have not undertaken any action for low denomination currencies. They have not thought about the ATMs and making changes in those machines and the systems with the banking system to dispense cash!
Neither they did any thing to make at least the educated and well to do Indian middle class to switch to cashless electronic money transactions! There have been no governmental rules or systems that ensured this.
As of now, the troubles of the people and increasing day by day. The most vulnerable are the citizens at the lower rungs of the society who earned their daily earnings in low denomination paper cash. The retail traders, the rural farmers, the daily wage earners and the like are all miserably affected. The Indian economy has come to a pathetic halt not because of shortage of money, but because of the inability of the government to make financial transactions possible wherever it was needed!
The inability of the government to dispense the worries of the people at this stage is more worrisome now. The news of infighting within the government and the political system have been enhancing the worries.
There are reports of large scale loss of employment especially in the unorganized sector. Whether this will percolate to the organized sector is something the regular employees of India keep watching tense-fully!
The long ques in the banks and ATMs in India are nothing encouraging to the Indian economy. The catch of unaccounted cash in the new currencies and the threat of the government with more penalties and punishments to the economic violators are not any thing that make India an investment friendly nation!
The nature of uncertainty in the economy is not anything good for a nation like India. No doubt, we need to tackle black money, counterfeits and black economy. But it should not be at the cost of the whole economy.
Will any one burn the house for fear of rats?
What could have gone wrong in this big administrative decision of the Indian government?
I think it is one typical case of administrative goof up just as the deeds done by Muhammad-bin-Tugluq a few centuries ago due to lack of well informed planning and unprofessional execution. Historians do admit the good intentions of Tugluq, though!
In the current case, if we observe unbiased, it is not difficult to find an unnecessary and undue encroachment by the political leadership in an administrative act that involved high degree of economic and financial complexities! Though the government is supreme, it was a job of the Reserve Bank of India and the latter should have done it professionally after due homework!
Instead what the people of India witnessed? The PM announcing the decision most dramatically at an awkward time in the news channels! And the man responsible for the final thing- the governor of the RBI was not to be seen anywhere!
And for that matter, the RBI boss was a new one. No doubt, he was an experienced professional in some other field. But he took the reigns of RBI only very recently. That kind of a time period is just not sufficient for any external management expert to master the complexities involved in the management of the central bank! With that short stint, he was obviously not in a position to advise the political and bureaucratic bosses with correct predictions and consequences even if he was consulted prior to the move!
And that explains why the RBI is very poorly equipped to deal with the consequences of the 8/11 demonetization act! Nothing surprising then to learn about the inadequate stock of currency printing paper and security inks with the security presses managed by the RBI! Nothing surprising to find the ATMs of the country cannot be equipped for the new paper currencies! Nor the failure of the Indian banking system to act foolproof post demonetization is also nothing surprising!
No one with the right kind of information would have ever thought that India is fully equipped for digital revolution to such an extent that it can do away with physical currency in just one stroke! No doubt, India has achieved much in the recent years with regard to its internet networks and electronic communication systems. But that is just not enough and can never replace the common money that the poor and ignorant majority Indians are still depended upon in the present times. At the most these are wishful thoughts for India for the future!
What could have gone wrong in this big administrative decision of the Indian government?
I think it is one typical case of administrative goof up just as the deeds done by Muhammad-bin-Tugluq a few centuries ago due to lack of well informed planning and unprofessional execution. Historians do admit the good intentions of Tugluq, though!
In the current case, if we observe unbiased, it is not difficult to find an unnecessary and undue encroachment by the political leadership in an administrative act that involved high degree of economic and financial complexities! Though the government is supreme, it was a job of the Reserve Bank of India and the latter should have done it professionally after due homework!
Instead what the people of India witnessed? The PM announcing the decision most dramatically at an awkward time in the news channels! And the man responsible for the final thing- the governor of the RBI was not to be seen anywhere!
And for that matter, the RBI boss was a new one. No doubt, he was an experienced professional in some other field. But he took the reigns of RBI only very recently. That kind of a time period is just not sufficient for any external management expert to master the complexities involved in the management of the central bank! With that short stint, he was obviously not in a position to advise the political and bureaucratic bosses with correct predictions and consequences even if he was consulted prior to the move!
And that explains why the RBI is very poorly equipped to deal with the consequences of the 8/11 demonetization act! Nothing surprising then to learn about the inadequate stock of currency printing paper and security inks with the security presses managed by the RBI! Nothing surprising to find the ATMs of the country cannot be equipped for the new paper currencies! Nor the failure of the Indian banking system to act foolproof post demonetization is also nothing surprising!
No one with the right kind of information would have ever thought that India is fully equipped for digital revolution to such an extent that it can do away with physical currency in just one stroke! No doubt, India has achieved much in the recent years with regard to its internet networks and electronic communication systems. But that is just not enough and can never replace the common money that the poor and ignorant majority Indians are still depended upon in the present times. At the most these are wishful thoughts for India for the future!
Unless the people are reasonably well to do with above poverty incomes and reasonable standards of living it is difficult for any government to honesty remove corruption. Under privileged masses are prone to be the poaching ground for the clever characterless people to perpetuate corruption! With India with its present levels of below poverty line and marginally above poverty line masses, the upper money making lots would keep their exploitation practices in so many ways so long as the latter change their evil mindsets!
There are better alternatives and that is the need of the hour! Income tax raids and stricter punishments for black money would only make corruption money to change hands! It will not eliminate corruption! Why not the government encourage people to pay taxes honestly and honor the high tax payers with awards instead of threatening all tax payers with draconian punishments? Draconian rules are the first cause for corruption, in my humble opinion! And corruption is the first cause for black money and black economy!
We may have moved to the 21st century, but with all those who enjoy power and position, the mindset remain as of the dark ages! The moment power and position are achieved, human mind tilts towards evil and begins to explore ways to exploit others instead of being of any good service to others!
Observe any man who occupies a powerful seat of power high or low. Observe his or her ways and manners. Is it not the same like the hawks or the wild hyena? Or may be of the cunning jackal? And watch the same person after he or she is removed from the seat of power!
And character cannot be brought in a man or woman just by education. Without character, there is potential of evil always. Developing good character in the people is a lengthy process that might take generations for full transformation. Yet, it is nothing non-achievable for the individuals!
In this context some readers might remember what I had written some time ago: An attempt to eradicate corruption in any characterless society would bring about more corruption!
So what the PM should have done in the current situation?
He should have created a situation that encouraged good citizens to do their economic activities without fear or apprehension while making it difficult for those who are more prone to corrupt acts.
He should have eased the income tax rules and laws and created better systems and procedures for people to pay their taxes honestly and removed the draconian or complex return filing procedures for individuals while making it perhaps necessary only for business firms. Let the government tax all incomes at the source, but why should the individual tax payers troubled for keeping all mundane accounts and file the returns error free in a system that no Indian can do without external help? Obviously, such systems and procedures are made by tax officials when they are in power with the intention of enhancing their power! And such enhanced powers obviously become another source of corruption!
Why does the government keep agricultural incomes tax free for all? Is it not a good opportunity to convert big black money? How on earth someone check the validity of any one declaring a million or more income from a few acres of land that he or she holds without doing any farming at all? This one provision compels many to buy cheap farm lands and keep them barren or under utilized for tax evasion. Even if the farms yield big incomes, why such incomes should be tax tree? Small farm incomes should be tax free. But big farms should not be.
Why does the government extent many tax free privileges and perks to the government officials while no such things are available to employees in the private domains? Why does the government keep enhancing the salaries, perks and pensions of the government employees without any due consideration to spend any tax collections for any logical social benefits to the general public including the tax payers?
I remember a youth working in a private company in India asking me this question recently: Why should we pay income tax when the government does nothing for us from the tax so collected? Will the government pay us subsistence allowance if I lose my job tomorrow and become income less from the tax they collected from me earlier? And remember, the several developed nations in the present day world do have such schemes while the government of India does not subscribe to any such ideas.
The youngsters of India do not wish to hear from the government that they take taxes only for fighting wars or defending the borders. Of course, that is important. But concurrently, the government has to prove to the nation that every rupee they collect as taxes are spent wisely for the people! When the people realize, it more and more will honestly come forward to pay taxes!
But no doubt, it is not good for modern governments to function as goonda sarkars of the bygone past when the word sarkar was actually associated with danda or stick!
There are better alternatives and that is the need of the hour! Income tax raids and stricter punishments for black money would only make corruption money to change hands! It will not eliminate corruption! Why not the government encourage people to pay taxes honestly and honor the high tax payers with awards instead of threatening all tax payers with draconian punishments? Draconian rules are the first cause for corruption, in my humble opinion! And corruption is the first cause for black money and black economy!
We may have moved to the 21st century, but with all those who enjoy power and position, the mindset remain as of the dark ages! The moment power and position are achieved, human mind tilts towards evil and begins to explore ways to exploit others instead of being of any good service to others!
Observe any man who occupies a powerful seat of power high or low. Observe his or her ways and manners. Is it not the same like the hawks or the wild hyena? Or may be of the cunning jackal? And watch the same person after he or she is removed from the seat of power!
And character cannot be brought in a man or woman just by education. Without character, there is potential of evil always. Developing good character in the people is a lengthy process that might take generations for full transformation. Yet, it is nothing non-achievable for the individuals!
In this context some readers might remember what I had written some time ago: An attempt to eradicate corruption in any characterless society would bring about more corruption!
So what the PM should have done in the current situation?
He should have created a situation that encouraged good citizens to do their economic activities without fear or apprehension while making it difficult for those who are more prone to corrupt acts.
He should have eased the income tax rules and laws and created better systems and procedures for people to pay their taxes honestly and removed the draconian or complex return filing procedures for individuals while making it perhaps necessary only for business firms. Let the government tax all incomes at the source, but why should the individual tax payers troubled for keeping all mundane accounts and file the returns error free in a system that no Indian can do without external help? Obviously, such systems and procedures are made by tax officials when they are in power with the intention of enhancing their power! And such enhanced powers obviously become another source of corruption!
Why does the government keep agricultural incomes tax free for all? Is it not a good opportunity to convert big black money? How on earth someone check the validity of any one declaring a million or more income from a few acres of land that he or she holds without doing any farming at all? This one provision compels many to buy cheap farm lands and keep them barren or under utilized for tax evasion. Even if the farms yield big incomes, why such incomes should be tax tree? Small farm incomes should be tax free. But big farms should not be.
Why does the government extent many tax free privileges and perks to the government officials while no such things are available to employees in the private domains? Why does the government keep enhancing the salaries, perks and pensions of the government employees without any due consideration to spend any tax collections for any logical social benefits to the general public including the tax payers?
I remember a youth working in a private company in India asking me this question recently: Why should we pay income tax when the government does nothing for us from the tax so collected? Will the government pay us subsistence allowance if I lose my job tomorrow and become income less from the tax they collected from me earlier? And remember, the several developed nations in the present day world do have such schemes while the government of India does not subscribe to any such ideas.
The youngsters of India do not wish to hear from the government that they take taxes only for fighting wars or defending the borders. Of course, that is important. But concurrently, the government has to prove to the nation that every rupee they collect as taxes are spent wisely for the people! When the people realize, it more and more will honestly come forward to pay taxes!
But no doubt, it is not good for modern governments to function as goonda sarkars of the bygone past when the word sarkar was actually associated with danda or stick!
Let us hope the PM and his team recognize the anxiety of the silent and honest masses of India now and take some bold but honest corrective steps that make India and Indians shine!
