Congratulating PM Modi on #SurgicalStrikeonBlackMoney
Common Indians stunned, a little bit shocked – cautious – and then after understanding the whole issue of the #CurrencyNotes , rejoiced knowing that what it aimed at. They knew that Prime Minister Narendra Modi’s arrow has aimed at many targets.
Politicians and people’s representative from all political parties, builder lobby, government babus and all corrupt elements in the society cannot open their mouth now. Even the Congress Party, which dared PM Modi yesterday night, has today meowed in the next morning on the #SurgicalStrikeonBlackMoney by PM Modi. The decision of demonetization of the currency notes of Rs500 and Rs1000 is not a mere political or typical economy related decision. The vigour shown by Modi to implement and execute this decision has a greater value of national security and national financial ethics attached with that. It has the power to streamline black market, corruption, loony financial habits of Indians, deeply rooted “Chalta Hai” (who cares) approach and more than that the breaking of Pakistan’s fake note disaster harming the Indian Economy.
The government says that the Fake Indian Currency Notes (FICN) are being used for subversive activities such as espionage, smuggling of arms, drugs and other contrabands into India. This fake currency has always a link of financing of terrorism and drug trafficking. Use of high denomination notes for storage of unaccounted wealth has been evident from cash recoveries made by law enforcement agencies from time to time.
For a common person, it becomes an issue of discomfort and humiliation when someone stares at him and the Rs500 note with a suspicion. The fake notes look similar to genuine notes. High denomination notes are known to facilitate generation of black money.
The demonetization of the Currency notes of Rs500 and Rs1000 has also a background of this observation.
While the total number of bank notes in circulation rose by 40% between 2011 and 2016, the increase in the number of notes of Rs.500/- denomination was 76% and for Rs.1,000/- denomination was 109% during this period. New Series bank notes of Rs.500/- and Rs.2,000/- denominations will be introduced for circulation from 10th November 2016. Infusion of Rs.2,000/- bank notes will be monitored and regulated by RBI. The introduction of new series of banknotes which will be distinctly different from the current ones in terms of look, design, size and colour has been planned.
The World Bank in July 2010 estimated the size of the shadow economy for India at 20.7% of the GDP in 1999 and rising to 23.2% in 2007. There are similar estimates made by other Indian and international agencies. A parallel shadow economy corrodes and eats into the vitals of the country’s economy. It generates inflation which adversely affects the poor and the middle classes more than others. It deprives Government of its legitimate revenues which could have been otherwise used for welfare and development activities.
The #SurgicalStrikeonBlackMoney will eliminate Black Money which casts a long shadow of the parallel economy on our real economy.
In the last two years, the Government has taken a number of steps to curb the menace of black money in the economy. The first decision that the Modi government took after gaining power was to set up of a Special Investigation Team (SIT) on Black Money.
The Government enacted a law regarding undisclosed foreign income and assets. The Double Taxation Avoidance Agreement between India and Mauritius and India and Cyprus was amended.
Government improvised an understanding with Switzerland for getting information on Bank accounts held by Indians with HSBC; encouraging the use of non-cash and digital payments. Recently the Benami Transactions Act and implemented the Income Declaration Scheme 2016.