Demonetisation

How Long Will the Country Remain Under Modi’s Spell?

The prime minister’s appeal to ignore temporary hardship in lieu of a better post-demonetisation tomorrow has resonated with the public, but it remains to be seen how long this support will last.

Narendra Modi, Chief Minister of India's western state of Gujarat, gestures after taking his oath as chief minister during a swearing-in ceremony in Ahmedabad December 26, 2012. Modi won a fourth successive term as the chief minister of Gujarat state last week, a victory that could launch the prime ministerial ambitions of one of the country's most popular but controversial leaders. REUTERS/Amit Dave (INDIA - Tags: POLITICS ELECTIONS)

Prime Minister Narendra Modi. Credit:Reuters/Amit Dave

Our neighbourhood barber reported a huge drop in footfall. The vegetable vendor doesn’t say much, but he must be hurting too. Several people have – hopefully temporarily – switched to large stores that accept card payments. Debi (name changed), our otherwise reliable nanny, returned from her Odisha village later than expected. She needed the extra time to withdraw money to leave behind with her elderly, widowed mother. It was on her fifth trip to the bank (12 km away) – including two trips made on foot because she wanted to save on travel fare – that she was able to withdraw money. But for our intervention, Anita (name changed), who substituted for Debi in her absence and doesn’t hold a bank account, would have been scared into an unfair exchange of her modest savings.

Of course, one has heard it all – and worse. We have heard of those who have died while waiting in bank queues or waiting for medical treatment, of families who have cut down on meals and of migrant labourers sent home empty-handed. Calling this a ‘temporary inconvenience’, as several demonetisation backers have done, not only trivialises the struggles of the poor but also reveals a flawed understanding of poverty itself.

Inconvenience is when one walks instead of taking an auto or taxi to the nearest shopping complex, it is cutting back on smoking or struggling to buy cheap goods with only a Rs 2,000 note in your pocket. Having your hard-earned money first declared useless and then rationed, and seeing your business or work dry up, isn’t an inconvenience, it is a tragedy. Especially for wage labourers and small vendors who make up a large part of the workforce and whose ability to absorb income shock – however short-term and small – is low. Poverty, in essence, is a precarious condition, one push and life keels over. Additionally, there is the uncertainty about whether and when things will normalise.

But if things are so bad, why isn’t the resentment visible on the streets and in post-demonetisation election results? There are several reasons behind it.

First, the way in which the demonetisation move has been pitched as being done to weed out the black economy and how unexceptionable aims have been conflated with what has turned out to be a conceptually flawed and poorly executed measure. Who in their right mind then would oppose an attempt to flush our black money and choke terrorist funding?

Second, it reflects the disgust the public at large has harboured against the corrupt. The disgust – deep-seated and entirely justified – has meant that the affected have chosen to grit their teeth and ignore their rumbling stomachs in the hope of a thorough, one-time cleanup.

Additionally, it also means that India’s poor have once again been called upon to make sacrifices in the name of national interest.

Third, a weak political opposition has failed to mobilise opinion around the dodgy economics behind the move and its uncertain benefits. Allegations about advance information leak haven’t stuck either.

The most important reason for the subdued response, however, could be the prime ministerial weight. Ranged against a divided and discredited political opposition is the personal word and assurance from Prime Minister Narendra Modi – an individual whose messianic aura has remained unaffected despite the many disappointments under his regime.

Simply put, the Modi’s appeal to Indians to ignore temporary hardship in lieu of a total cleanse of the economy, a future where honest Indians will live with dignity and the national wealth will be deployed for the benefit of the poor has resonated with the public. It has resonated enough for well-founded questions around property rights infringement, the proportion of ill-gotten wealth likely to be unearthed with demonetisation and impacts on high employment sectors such as agriculture and construction, to be ignored and emerging evidence of black money being legitimised through various creative means to be brushed aside.

Most importantly, the actual trauma of living in demonetised times seems to be occurring in another existential dimension.

In order to explain this staggering prime ministerial achievement, we need to go back to what Modi has tried doing ever since his appearance on the national canvas – presenting himself as a lonely, heroic and visionary figure intent on combating the huge legacy issues and entrenched interests that are looking to sabotage him. In his Augean missions, all he has sought is the support of the people. Given the sheer audacity of the demonetisation move and the fact that the public has largely kept its patience despite all that is unfolding, it would appear that Modi has successfully capitalised on the latitude that he has earned.

It remains to be seen though how long the prime minister’s spell and undertaking of a better post-demonetisation tomorrow would hold sway. For now, Modi seems to have some fuel left in the tank but sceptic minds will go back to the Vajpayee years.

Everything was supposed to be going well in the Vajpayee era. Business-friendly measures, together with ambitious road and power projects were said to have set the economy on a strong growth path, national muscle had been flexed with the nuclear blasts and the Kargil War victory and, according to L.K. Advani, “There was not even a whisper of corruption against the government”.

India was shining until the 2004 parliamentary election results came. Those immiserated had spoken and drowned out the cheerleaders in the mainstream media and India Inc.

The similarities between the Vajpayee and Modi eras are hard to miss. There’s the same promise of economic superpowerdom with the same business and infrastructure development-led strategy in the air, the same muscle flexing with cross-border surgical strikes, the same claim of a corruption-free sarkar, the same underlying belief that growth, infrastructure and technology are by themselves sufficient to address poverty and vulnerability. And in taking forward proposals that substantively connect only with certain voluble classes – in this instance, the card-wielding, social media and app-savvy classes – and trapping himself in an echo chamber resonating with feedback from them, Modi runs the same risk as the first BJP prime minister did.

Manish Dubey is an independent policy analyst working on decentralised governance, water and sanitation and rural livelihood issues. His work has previously been carried by Kafila, ESPN Cricinfo and The Hindu. He is the author of A Murder In Gurgaon.

  • soumya

    the terrible reality of the poor has nothing to do with demonetisation-afterall it is the exchnage of demonetised notes to new ones not farsaking of legitimate ones and also the currency of exchange is not 1000 rs but much lesser notes.
    lets not simplify the effect for lack of a better solution in audacity,reach and impact.
    let us not sabotage the first honest government initiative by romanticising the impact on the poor [which is unreal,and I belong to rural india]and not absorb the positive impact on credit availability,deficit after this short consequence.
    the writer seems to manufacture a argument from his ideological biases..

  • https://hrplacetech.wordpress.com HidayatRizvi

    How long will country remain under Modi’s spell? How long the lines will last? How long will people get their white money with no difficulty? How long till small business will run like pre Demonatization days with no difficulty? How long till employment reaches pre Demonatization level? How long till economy, gdp share market and dollar reaches pre Demonatization level? As of today no one knows. But I know one thing BJP gave 2 pms who don’t have a family and children and in liberal democracies people learn it hard way or easy way that you need your pm or president to be a family man with children.