After the wound, now comes the balm. But, those who expected big bang announcements from Prime Minister Narendra Modi are bound to be disappointed. The hopes of a cash bonanza for the poor, who bore the brunt of the demonetisation pain, were belied as the Prime Minister’s address to the nation on New Year’s Eve was high on rhetoric and short on specific benefits for those who suffered most due to the cash crunch.Though Modi unveiled a slew of sops, including interest rate rebate on home loans, enhanced credit for small businesses, more houses for the rural poor, fixed interest rate of 8 per cent on deposits by senior citizens and cash assistance for pregnant women, the package falls far short of expectations if the objective was to soften the massive, all-encompassing impact of currency ban. The offer of two-month interest cushion on farm loans for the rabi season will not be of any significant help to the farming community reeling under a crisis.
At the end of the painful 50-day period, as people were glued to their television sets for the PM’s address, the build-up and air of expectation surrounding the event was similar to the one ahead of any India-Pakistan ODI match. However, Modi did not offer any analysis of the gains of demonetisation and the extent of the scrapped notes coming back into the system nor was he specific about the timeframe for restoration of complete normalcy in banks. Instead, he appeared to frame the debate in the “honest versus dishonest” narrative, offering hopes of long-term benefits accruing to honest people. No assessment was forthcoming on the size of the parallel economy or the extent black money unearthed by the dramatic invalidation of high-value notes. There are expectations in political circles that some populist schemes and freebies may be unveiled in a phased manner, some at election rallies in poll-bound Uttar Pradesh and some more in the Union Budget. Modi’s promise to go after the corrupt and tax evaders, determination to expand the tax base and push for greater reliance on digital and banking-based payments are some of the pointers in this direction. The offer of interest rebate for housing loan for the urban poor and middle class is seen as a prelude to a big surgical strike on the real estate sector to target illegal properties.
The address could have made far greater impact if Modi had voluntarily pledged his party’s commitment to clean up its funding. Instead, he made a general appeal to political parties to become transparent. As the PM pitched demonetisation as a battle between good and evil, it must be realised that it is only a first baby step in the war on black money and corruption and people expect many more to follow.