In a drastic move to tackle black money and corruption, the Indian government decided to demonetise the 500 and 1000 rupee notes, making them equivalent to a worthless piece of paper. As banks prepare to face the rush of the masses when they open, we, at Pune 365, spoke to those whose occupation depends entirely upon day-to-day transactions in cash. We also spoke to experts, who gave us their opinion on how this change (pun intended) will affect people and the economy.
Rajas Parchure, Director of the renowned Gokhale Institute of Politics and Economics, is of the opinion that the demonetisation of the notes will have a limited impact. “This brings out two areas, one is that all the counterfeit notes will get identified and will be taken out of circulation. Secondly, people who take a lot of money to the banks will also be identified and brought under the tax net.”
But what about the inconvenience that will be faced by people during these days by the sudden decision?
Parchure says, “People will suffer for two to three days because you cannot exchange notes for anything else. It will not become a logistical failure as the banks will monitor the money coming in and will give out freshly printed notes accordingly. Such decisions should be sudden. Modi is an intelligent man as he has made this announcement before the Uttar Pradesh elections. This is a good move.”
Rukmini Sakat, a vegetable vendor at Shivaji market travels every day from Loni and is the sole bread winner of her family, she says, “I had no idea about this new rule. Since morning customers have been giving me notes of 500 and I accepted them. Now what do I do?” Another vendor echoes her concerns, “I don’t have a bank account. Today when I came to the market I heard about this new development.” She then points at the 500 rupee note in her hand and exclaims, “Kya karoon main inska? (What do I do with this?)”
Few pharmacies were observed to be shut in the Camp area. To avoid dealing with excessive change return, Wellness, which is a 24-hour pharmacy, was still functioning but have partially put down their shutters.
A city-based banker ( name withheld on request) says that all the workers in banks are under immense pressure. “There will be a huge rush of customers in banks from the time they open their shutters.” Speaking about whether it is wrong to introduce such a move suddenly, the banker says, “It is not wrong. It is strategic. If this was announced earlier then people holding black money would have found loopholes in it.”
Can this move backfire and create chaos?
“Even Chanda Kochhar, the CEO of ICICI Bank, said that they are logistically unsure of how this can be handled. Banks should make sure that the 100 rupee notes reach the remote areas as the economically weaker section of society will face many troubles. Already there is so much chaos as people are standing in long queues at ATMs. It all depends upon the RBI’s supply of cash to banks and banks in turn, must make sure that ATM machines are replenished often,” he adds.
As of now, banks will be open tomorrow, Friday, Saturday and Sunday.