The first 15 minutes or so went on thanking the people for their cooperation and their suffering and pain in the last 50 days. He stated that the circulation of black money is larger than legal ones (which, I think is patently wrong). By demonetisation he asserts that he has dealt a blow to the black marketers and the corrupt, which too could be a short lived one.
He has repeatedly warned that the corrupt will not be spared, though the existing laws and methods are still far too lenient in the tackle.
He however is patently wrong while surmising that the money deposited to the banks by the people was done voluntarily or the money is now for the enjoyment of the banks. Banks he claims shall formulate policies to favour the poor and the middle-class people and the MSME industrial sector. Cash deposited with the banks are a liability of the banks and by law are liable to be returned on demand, be it in the Savings or Fixed deposits. Unless of course, there is a long term restriction on withdrawls of their own money by the depositors.
A few schemes like assistance in housing for the urban and rural poor, help to farmers, small traders, either by interest subvention schemes or a bit higher bank interest for senior citizens, discount on digital transactions etc. cannot be balanced without simultaneous reduction in savings as well, though he asserts that the government will support the banks of losses suffered on these account. We have to watch the budgetary support is provided for the announcements.
A Rs.6000 assistance to each of pregnant poor to defray cost of pre and post delivery costs, vaccinations is a welcome step, though thee already existed schemes in different hues.
The entire speech now is focussed on the poor, and middle class and sounds a bit apologetic. Substituting the present credit/cards with Rupay or with the BHIM is merely an old wine in a new bottle.
How less cash will reduce corruption or the greed of government officials change is a question that can be answered by only by time, going by the experience of the cunningness and connivance of a section of bank officials in helping the hoarders in the last 50 days.
I wait for the benami and other deterrents to become the reality, though there was no whisper on same. He seems to be pushing for a common state funded election, which has to go through a laborious run through the parliament and the state assemblies.
What is the amount of black money erased out? How much is the fake currency taken out of the circulation? When will the restrictions on the money withdrawal ease? What is the government’s stand on private gold holdings? They will all have to wait!
I did not see any dhamaka. A finance minister could have done all these and more in his forthcoming budget speech as well!
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Thank you for an insightful post Sir.