- PM Modi says party lawmakers must publicise benefits of notes ban
- Parliament stalled over notes ban, opposition says PM must apologise
- Notes ban introduced suddenly a month ago, causing cash crunch
Confronting criticism from the opposition and experts about its demonetisation drive, the BJP's lawmakers at a morning meeting at parliament adopted a resolution welcoming the people's backing of the reform introduced a month ago on November 8 with PM Modi announcing that it would flush out black money.
The BJP's fist-bump to itself for its reform was not duplicated in parliament which has been largely paralysed with the opposition attacking the government over its move. First, parties wanted Prime Minister Narendra Modi to explain his decision, stating an outline from Finance Minister Arun Jaitley would not suffice. After the PM agreed to comment, the opposition said what it really wanted was an apology from him for the hardship caused to lakhs of people.
"The opposition protests are made for television," said the Finance Minister in parliament, daring the opposition to resume a crucial debate on the notes ban. Union Minister Ananth Kumar said that the country's backing of the PM has been evidenced this week by his winning the online readers' poll for Time Magazine's Person of the Year.
The abrupt withdrawal of 86 per cent of the notes that were in circulation was followed by insufficient new bills, which has plunged the country, particularly rural India, into an exacting cash shortage. The government has taken a series of steps to minimise pain points for farmers by offering special loans and permitting the use of the outlawed notes to buy seeds. But rural banks complain they don't have enough cash to disperse and farmers are worried about falling behind schedule on their winter crops.
So far, 82 per cent of the outlawed notes have been deposited - about Rs 12.6 lakh crore of a total of Rs 15.3 lakh crore ($225 billion) has been turned into banks. This has experts pointing out that it's likely that virtually all the abolished currency will be declared, which means that there will be very little black money left undisclosed. What, then, is the point of this vast and expensive exercise analysts have asked.
"Lack of a meaningful cancellation could be a double blow for Modi as the measure was being used as a political and economic gauge of the success of his Nov. 8 move. One of Modi's biggest campaign pledges was to expose black money in Asia's No. 3 economy, and economists were viewing the cash as a potential windfall for the government," said this report in Bloomberg.
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