Prime Minister Narendra Modi said yesterday he was confident India would emerge “glowing like gold” following the government’s decision to scrap high-value currency notes.
Bank notes of Rs500 and Rs1,000 ceased to be legal tender from midnight on November 8, hours after Modi announced the move to fight corruption and tax evasion.
“Almost every economist is analysing the move. The whole world is watching whether 1.25bn Indians will be successful even after enduring hardships,” Modi said in his monthly radio address ‘Mann Ki Baat’.
“The world may have questions or doubts, but India has faith in its people. Our country will emerge glowing like gold from the fire. The main reason behind this confidence is our people,” he said.
Modi’s comments come days after his predecessor, Manmohan Singh, considered the architect of India’s economic reforms, said the country’s gross domestic product (GDP) would fall by about 2% because of the decision.
A number of economic think-tanks have also revised down their growth outlook for India.
Over the past weeks, Indians have been struggling to get new Rs500 and 2,000 notes, forming queues outside banks and ATMs.
Businesses have also suffered due to the liquidity crunch.
Modi has said the cash crunch will be over by the end of December and appealed to Indians to embrace cashless transactions through mobile banking, debit and credit cards.
“Learn the different ways you can use your bank accounts and Internet banking. Learn how to effectively use the apps of various banks on your phones. Learn how to run your business without cash. Learn about card payments and other electronic modes of payment,” Modi said.
“A cashless economy is secure, it is clean.”
Modi asked the youth of India to take a pledge to make this initiative a success and urged them to teach their families, neighbours and small business owners how to go cashless and make electronic payments.
“You have a leadership role to play in taking India towards an increasingly digital economy. Your father or mother or even elder brother at home may not know. But you know how to book train tickets online, you know how to buy things online.
“Educate them on how to download apps, how to spend money using mobile phones, how to make payments, how to do business.
“More importantly, if you could teach a push-cart vendor or your vegetable vendor, there is no reason we cannot move towards a cashless India.”
Senior officials admit the move will disrupt economic activity but argue it will be beneficial for the economy in the long-term.
Opposition parties have called for a nationwide protest today against the decision to withdraw the notes.
However, the Congress Party said it has not called for a ‘Bharat bandh’ or a countrywide shutdown but ‘Jan Aakrosh Diwas’ to hold protests over demonetisation.
“There will be protest rallies; we have not called for a ‘Bharat bandh’ (shutdown). Misinformation has been spread by the BJP, which is ill-informed,” senior Congress leader Jairam Ramesh said.
“The Bharatiya Janata Party has spread the misinformation that the Congress and other opposition parties have called for a ‘bandh’. The country is already shut from November 9, a day after the prime minister announced the demonetisation move. That’s why we don’t want a ‘Bharat bandh’,” he added.
Ramesh said the decision to demonitise the Rs1,000 and Rs500 notes was to hide the central government’s own failure to deliver on Modi’s promise of bringing back black money from abroad, made during the 2014 general elections.
“It is a political move being projected as a fight against corruption,” said the Congress leader.
“People who actually have black money are still leading a luxurious life whereas honest people are facing hardships,” he added.
People queue outside an ATM of State Bank of India to withdraw cash in Ahmedabad yesterday.
