Spotlight
New
Delhi, 27 January 2017
Demonetisation
Takeaways
ENVIRONMENTALLY
CLEANER INDIA
By Proloy
Bagchi
Prime Minister Modi’s demonetisation
has been roundly criticized on various counts by politicians, economists,
social organisations and general public. But not many ever looked at the gains
of “note-bandi”, as demonetisation
has since come to be known. One finds that a massive take-away from
demonetisation was that those who, despite having had opportunities, shunned
illegal wealth and found virtue in being ethical and honest. Even it found
resonance with Finance Minister Arun Jaitley who said the measure accorded a
semblance of dignity to them.
As is well known, the abrupt ban on
the two high value currency denominations of Rs. 500 and Rs. 1000 caught the
people by surprise and many who had stashed away sizable hoards of these were
naturally the first to raise an outcry in opposition. True, the proverbial aam aadmi, was put to a lot of
inconvenience. People had the best reasons for criticising the move; but it was not they who, though
suffering its consequences, criticised it as most of them realised it was a
good way to catch the corrupt and the unscrupulous black money barons.
That the political opposition
criticised the measure was understandable but many intellectuals, especially
the economists also found it amiss. The former economist Prime Minister
Manmohan Singh called it a “monumental disaster” and others said that the poor,
daily wagers and farmers would be hit rendering them jobless as most of their
transactions were in cash. And yet it would, they said, hardly make any dent on
those who had the dirty money.
All that and much more can be
elaborated and dilated upon. However, for the people there was something
greater for their physical environment as well. Soon after the measure was
announced headlines in newspapers screamed cash crunch “brings auto industry to
a screeching halt”, auto industry faces “30% drop in November sales”, “auto
sector for a rough phase” and so on.
On the face of it, the harsh impact
on the sector may look unfair. After all, in the 1990s it was on the auto
sector that the economy took a ride to some spectacular growth in the new
century. But then it grew so much that it became something like a Frankenstein,
threatening the very people for whom it was to work for. The reforms, in due
course, created an upsurge in the middle classes raising their standard of
living and aspirations that generally centred around an automobile and a house –
both of which everyone coveted.
The banks fed the market with cheap
loans and before one realised what was happening there were far too many
automobiles choking and clogging urban India, emitting tonnes of carbon
into the atmosphere with all its lethal components threatening the lives of
everybody around. The expanded market attracted manufacturers from almost all
European countries and the US
as also from Japan and Korea.
Before the 1991 reforms the country
used to produce passenger vehicles only in thousands, today it produces them in
millions (2.8 million by the last count in 2015). This apart 16 million two
wheelers were also manufactured. It has been a great jamboree for the middle classes,
fed as they were by the saying “have money, buy car”. Families that had space
for only one car and, maybe, a two wheeler had half a dozen cars – some of them
spilling over to the public spaces, narrow lanes, colony roads. While jams
became common even in tier 2 and tier 3 towns, providing parking spaces became
a mammoth problem for the civic bodies.
The urban air went for a toss
leading to diseases and deaths. The black economy has had no mean role in
boosting up of this sector by fostering demand for the highly polluting
diesel-driven SUVs that rule the roads. With a check on this sector, hopefully,
Indian urban air will be somewhat cleaner enabling citizens to breathe easy.
Thankfully, the Government is also in the process of framing laws to inhibit
reckless purchases of cars – a measure that will be widely welcomed.
Another Sector that has taken a hit
because of demonetisation is the realty sector. Reports say housing sales
dipped 44% after the scheme was rolled out. This is one sector which was pump-primed
by black money and has, therefore had a swift fall – if not permanently, at
least temporarily. This is the sector in which most of the illicit wealth is
invested; this is where the action is.
Here there are endless opportunities
as it, by itself, generates black money. Ministers and bureaucrats are
indulgent in handing out building permissions and all, together with the
engineers and contractors, partake off the pile. Everyone knows what kind of
games the politicians play with wealth so generated.
The urban sprawl has, therefore,
been marching out in almost all directions of most of the cities gobbling up
farmlands, forests, wetlands and their catchments or whatever comes in its way.
While this has been largely responsible for damaging the urban environment, it
has also, in many cases, exposed the inmates to nightmarish insanitation and
filth. The civic bodies, already stretched to provide necessary services, have
abstained themselves from such unplanned rapid urban expansion.
Most of the expanding fringes of the
Indian urbanscape draw underground water in the absence of the piped municipal
water. Thus, while levels of underground aquifers dip there is very little
scope for their recharge, given the ceaseless drawal and the increasingly
truant monsoons. Depletion of sub-soil water threatens water security as well
as the overground greenery – the trees that sustain the environment and
mitigate air pollution as well as harsh impacts of unkind seasons.
Fallout of the uncontrolled urban
expansion has been creation, like in China, of over-capacity in housing.
Noida or for that matter, Bhopal
have reportedly recorded over-capacity with thousands of units awaiting buyers.
And yet Awaas Melas are held in Bhopal where green hills,
farmlands and wetlands have been colonised.
It is the illegal money that fed the
real estate boom in their unplanned growth leading to civic mayhem and chaos.
Stripped of black money, the sector should cool for a while and in the meantime
the Government could move in to restrict urban growth drawing up “Urban Growth
Boundaries” like they do in the US.
If that were to be done the increasingly degrading environment around cities
and towns would be saved.
Demonetisation has given a push to a
cashless society where financial transactions will be paperless and carried out
electronically. Modi has been promoting, even incentivising cashless
transactions even in rural and semi-rural markets. This will surely reduce the
need for cash, which in any case, is currently in short supply. With less cash,
there will be lesser need of paper for printing currency.
A report recently said that as the
local sources were not able to provide paper for the need to replenish the
diminished cash in the system, 16 million tonnes of paper was going to be
imported. With the likely proliferation of electronic transactions the demand
for this kind of specialised paper will surely fall and that will be a gain for
the environment on the one hand, savings for the government on the other.
If “notebandi” is successfully taken to its logical conclusion, with
certain administrative measures people are likely to have a more hassle-free
life, led in an environmentally cleaner India. ---INFA
(Copyright,
India News and Feature Alliance)
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