One of the most incorrect and wrong narrative is that demonetisation destroyed illegitimate businesses that operated on black money or at the least it dented them or made their life miserable.
One both counts, it is a big NO.
1. Post demonetisation, as I said earlier, the business sentiment collapsed. People simply stopped buying except for the essentials. They stopped buying luxury items like houses, land, cars, scooters, travel, eating outside, parties, etc..
2. Hence demand collapsed leading to massive inventory pileup and losses to the businesses. Now this recessionary trend went on for over 2 yrs now and still yet to recover.
3. Legitamate businesses that operated only in white money could NOT sustain this sudden unplanned shock for months and months, Hence they collapsed one by one as they were unable to pay the bank loans, or pay the salaries or just ran out of cash flow.
4. Now enter our black money kings. They had enormous cash with them, which they cleverly converted using Jan dhan accounts and / or through their employees, servants, workers in the farm land, etc.. So they converted all black to white without paying any tax.
5. Now the black money guy with deep pockets withstood the recession and he saw all his legitamate competitors went out of business. So now he is repeating the benefit of being the only one or few players catering to all the customers.
6. Similarly all the salaried people who operated only on tax paid money - cement construction textiles real estate etc.. All of them lost jobs due to this unprecedented glut.
In the end, only the black money operators are standing and all the legitamate businesses and salaried employees are out of job.
It would be hilarious if not for being so tragic. Historic mandate squandered and ended up destroying vast swathes of our people and their livelyhood.
This is where the media is such a disaster in india. In any other country, the media would have gone hammer and tong and got this decision reversed instead of allowing this to go ahead.
One both counts, it is a big NO.
1. Post demonetisation, as I said earlier, the business sentiment collapsed. People simply stopped buying except for the essentials. They stopped buying luxury items like houses, land, cars, scooters, travel, eating outside, parties, etc..
2. Hence demand collapsed leading to massive inventory pileup and losses to the businesses. Now this recessionary trend went on for over 2 yrs now and still yet to recover.
3. Legitamate businesses that operated only in white money could NOT sustain this sudden unplanned shock for months and months, Hence they collapsed one by one as they were unable to pay the bank loans, or pay the salaries or just ran out of cash flow.
4. Now enter our black money kings. They had enormous cash with them, which they cleverly converted using Jan dhan accounts and / or through their employees, servants, workers in the farm land, etc.. So they converted all black to white without paying any tax.
5. Now the black money guy with deep pockets withstood the recession and he saw all his legitamate competitors went out of business. So now he is repeating the benefit of being the only one or few players catering to all the customers.
6. Similarly all the salaried people who operated only on tax paid money - cement construction textiles real estate etc.. All of them lost jobs due to this unprecedented glut.
In the end, only the black money operators are standing and all the legitamate businesses and salaried employees are out of job.
It would be hilarious if not for being so tragic. Historic mandate squandered and ended up destroying vast swathes of our people and their livelyhood.
This is where the media is such a disaster in india. In any other country, the media would have gone hammer and tong and got this decision reversed instead of allowing this to go ahead.
