Anil Bokil has gone from elation to disappointment in just two weeks.
Just a few days ago, Arthakranti Pratishthan, the Pune-based economic think-tank Bokil heads, had claimed credit for influencing prime minister Narendra Modi into taking his most disruptive economic step since gaining power in 2014: the demonetisation of high-value currency notes.
While some experts have hailed the move to crack down on black money and corruption, others have slammed its shoddy implementation and the inconvenience it has caused to millions in India’s cash-based economy. Modi’s gamble had made 86% of India’s currency (by value) in circulation invalid. Since then, there have been serpentine queues at India’s ATMs and banks.
“This is not what we proposed,” Bokil told The Economic Times on Nov. 21. “The government has only taken one part of our five-point plan… We had a proper transition plan from large currency denominations to smaller ones.”
A mechanical engineer by profession, Bokil gave a presentation to Modi earlier this year, detailing his proposal.
He suggested a five-point action plan that included scrapping all 56 taxes, including the income tax, recalling and scrapping the high-denomination currency notes of Rs1,000, Rs500, and Rs100. He also proposed that all high-value transactions be made only through the banking system using cheques or via e-payments. The government must introduce a banking transaction tax to compensate for losses incurred due to the scrapping of other taxes, he said.
“If you ban the entire lot in one go, how will you manage the flow of currencies?” Bokil now asks. “They’ve lost the transition plot completely. They should’ve stuck to our transition plan at least.”
He now wants the government to make the Rs50 currency the highest denomination in circulation in India. There is speculation that the government may use some of Arthakranti Pratishthan’s proposals in the upcoming budget. In its election manifesto, Modi’s Bharatiya Janata Party had promised to weed out black money—unaccounted wealth—that is estimated to make up 20% of India’s GDP.
“We are not saying we go completely cashless. Some cash will have to be there, but we need to set the bar at Rs50. For a country like us where 70% of the population survives on just $2 per day, why do we need currency notes upwards of Rs100?” Bokil told the Mint newspaper. The 55-year-old also reckons that the transition to lower denomination currencies would only take about 18 months.