Necessary preparation before demonetization?
In my opinion, following ten things could have been done before taking this initiative.
1. Hire at least 10000 IRS officer on contract basis to conduct the tax collection drive in the entire country. There are lakhs of UPSC aspirants who are qualified enough but falls on the other side of luck. The government could have absorbed them through the existing scheme of the examination on a 10-year contractual period.
2. Land records digitization should have been expedited and connected with the Adhar accounts. The technological prowess of overlaying techniques should have been used.
3. The mobile van model of ATM should have been tried and tested and popularized in the whole country.
4. The government could have waited few more years. The GST bill was on the anvil. This is expected to bring down taxation rates. This would have increased the taxation compliance for the large segment of population by itself.
5. The RBI should have increased the prevalence of lower denomination currency. At least the figure of 86% prevalence of rs. 500/1000 could have been brought down to 65% without getting attention in the public in a gradual manner over one to two years.
6. The report of Ratan P Watal commission on the spread of card payment was pending. The government could have waited and implemented its implementation first before shaking the whole nation.
7. The original scheme of Jan Dhan account should have been fully implemented. By this the country would have been prepared to switch to banking system. Today those accounts are conveniently used by rich people for conversion of black money to white money.
8. At least all the government offices, services and amenities should have started accepting the card payment and online payments. This would have reduced the corruption to large extent.
9. Jewellers, real estate people, mining barons and politicians account could have been scrutinized and audited by the additional force of 10000 in a detailed manner.
10. Political parties funding, NGO funding and religious organizations funding could have been brought under RTI rule.
Overall, I feel the step was premature. It was taken in haste, without proper political and economic accounting. Modi is a seasoned player of politics so it is hard to believe that how could he make such mistake or take such a polarizing and risky decision. Black money is substituted by the dark thoughts about the future of the country.
I invite you all to comment, suggest and share the views on the above-mentioned thoughts. more