This Article is From Nov 14, 2016

Notes Ban Is A Solid Move. But Team Modi's Messaging Is Not.

Prime Minister Narendra Modi's tearful defence yesterday of his war against the parallel black money economy is both an admission that the war is tougher and will last much longer than he expected, as well as the unstated frustration that his initiatives outside the country are received with greater appreciation than at home.

Modi's announcement to the nation a week ago banning the 500 and 1000 rupee notes was followed by a path-breaking visit to Japan, where he signed a nuclear deal with the only country in the world that has been a victim of a nuclear holocaust. But while he was riding in the Shinkansen bullet train - which is expected to zip between Mumbai and Ahmedabad in a decade or so - from Tokyo to Kobe, visuals of long, angry queues of Indians at ATMs that wouldn't work were juxtaposed with pictures of high currency notes floating down the Ganga in Uttar Pradesh and overflowing in a garbage bin in central Kolkata.

It is recommended that the PM hold his nerve. There is enough evidence that a large part of the black money economy is present in other currencies - which will always have a parallel hawala or money laundering available to it - and in the real estate and jewelry sectors.

PM Narendra Modi and his Japanese counterpart Shinzo Abe aboard the Shinkansen bullet train to Kobe

But the fact that Indians are burning notes or tearing them up is evidence that the bad guys are hurting. Unfortunately, ordinary Indians - which are in far larger numbers than the bad guys - are also hurting for no fault of theirs. 

There are two ways to assuage that short-term pain. First, keep the banks open all day and all night, and get BJP and allied MPs and MLAs to monitor what's going on an hourly and daily basis. These politicians must constantly explain to their constituents the necessity for such a ban.

The second is - improve communication. The messaging around the ban has been terrible. Finance Minister Arun Jaitley has held a few press conferences, but simple and clear data on the benefits of cracking down on the black economy - for example, it is expected to cut by half the Rs 5.3 trillion national budget deficit - are hardly played up.

Long queues at banks and ATMs have become routine for millions rushing to replace banned notes

So when Economic Affairs Secretary Shaktikanta Das told reporters that by 5 pm on Sunday evening, banks had netted $44 billion in 180 million transactions - he didn't add that this will also help pay a string of social welfare schemes from Swachh Bharat to Sarva Shiksha Abhiyan.

The PM's problem is that no one is explaining the crackdown on black money in terms that  you and I understand. Perhaps his bureaucrats are too afraid to tell him what to do and how to do it. Perhaps the PM prefers the big picture.

Perhaps, he should take a leaf out of the successes he has been able to log in the foreign policy domain. At the Ministry of External Affairs, the PM has been lucky to have competent people able to creatively ramp up his engagements abroad. Modi's spokespersons, Syed Akbaruddin and Vikas Swarup, have ensured that the message is as important as the medium, which has often meant a conflating of India's successes in the foreign policy domain with the image of the PM himself.

Defunct currency notes came floating down the Ganga; were spotted by people bathing in the river in Mirzapur in Uttar Pradesh

In some cases, as during the recent visit to Japan, the dissonance between the Indian and Japanese governments' understanding of the consequence of "if India tests a nuclear device" was beautifully managed in the media. reported that Indian officials insisted that the historic nuclear deal between the two countries - historic, because it has taken eight years since India and the US pushed the Nuclear Suppliers Group to give India an exception - did not preclude India from testing a nuclear device. But according to Japanese officials, NDTV added, all bets were off if India did such a thing. Indeed, all nuclear cooperation would immediately cease. The truth, as always, lies somewhere in between. In the English translation of the separate note called "Views and Understanding," signed as an additional document alongside the nuclear deal, the language banning nuclear testing is not explicit.

India, which conducts its foreign policy in English, will go by this interpretation of the note. But in the Japanese translation, which the Japanese employ in the domain of foreign policy as well as in their parliament, there is an explicit reference to the termination of the nuclear deal if India conducts a nuclear test. This is the interpretation that the Japanese parliament will ratify, whatever else the Indian government says. Both nations agree that the chances of India going nuclear are less than minimal - which is why both India and Japan won't publicly acknowledge the small print and the different interpretations both have agreed upon.

So here is what Modi and his domestic policy teams should learn from the Foreign Office, especially in the management of crises. First, preparation is important. So even if secrecy was the key in the banning of the high currency notes, the government should have anticipated and worked overtime to allay the trouble to people.

Second, constantly explain the nature of your message. One of the biggest problems with the black money ban has been the terrible messaging. The government has allowed the negativity to run ahead of the benefits. Instead, it should have acknowledged the short-term pain, but kept focusing on the bigger positive picture.

India and Japan signed a civilian nuclear agreement during PM Narendra Modi's visit last week

For example, the termination of economic cooperation with Japan in case India conducts nuclear tests, a very significant feature, was downplayed by the Ministry of External Affairs, but it kept hammering home the benefits of the historic nuclear deal with Japan.

Third, Prime Minister Narendra Modi should have reached out to his opponents across the political spectrum from Congress president Sonia Gandhi to NCP leader Sharad Pawar as well as all those going to the polls in Uttar Pradesh, Punjab and Goa. That would help in allaying the suspicion that while the BJP put its unaccounted-for money into bank accounts on the eve of several state elections, the main opposition parties have been dealt a body blow.

Just like his predecessor, Atal Behari Vajpayee, who called his political opponents after the nuclear tests were carried out on May 11, 1998 - so that they couldn't attack his decision, post-facto - Modi should have attempted to explain his black money war to other political leaders.

Perhaps, as he wipes his tears on his shirt-sleeve, the PM could reach for his cellphone, phone Mrs Gandhi and invite her to join the war against black money. Whether or not she takes his call is a moot point. The fact that he tried would be the important thing.

(Jyoti Malhotra has been a journalist for several years and retains an especial passion for dialogue and debate across South Asia.)

Disclaimer: The opinions expressed within this article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of NDTV and NDTV does not assume any responsibility or liability for the same.