Seemingly contradictory proverbs have been brought into play by the cash crunch at ATMs in several parts of the country. If the official line is to be accepted it was “a storm in a teacup” or “much ado about nothing” and the problems would be resolved in a matter of days.
Yet for the common man, the run on the ATMs was clearly a case of “once bitten twice shy” as the ghost of demonetisation raised its ugly head again, and there was a panic reaction since nobody wished to re-live that trauma.
However, the even larger message is that potentially positive policy initiatives can have a devastating backlash if their management and implementation falls far short of governmental expectation.
For even the most ardent advocate of the actions taken during the NDA government’s watch will have to concede that the monetary managers in the Reserve Bank and finance ministry have proved unequal to the task ~ since the recent discomfort can be traced back to the incompetence of 8 November 2016. Once the heat over demonetisation had subsided, the government slipped back into its lethargic ways, and has now “invited” a revival of painful memories.
There could be truth to the explanation that the present crunch was triggered by an unusual spike in the demands for cash ~ but it only emphasises the point about incompetent monetary management.
Not only were the signs of a rise in the demand for cash visible over recent weeks, explanations such as payment of compensation to farmers, the overlapping of festivals and suspected hoarding of currency notes of the Rs 2,000 denomination were all factors that an efficient and sensitive apparatus would have picked up; remedial action taken before a mini-crisis was permitted to develop.
In terms of monetary management, North Block has clearly headed “south” ~ its alibis add up to confirming ineptitude. Forget issues of high finance, there has been a tangible lack of impetus in the drive towards a less-cash economy; which was itself a dilution of the Prime Minister’s desire for a cashless economy.
Will the finance ministry care to calculate how many small merchants ~ the backbone of the day-to-day economy ~ opted for payment through plastic cards once there was a lessening of the agonies of demonetisation? Even the process of recalibrating ATMs to dispense different-size notes came to a virtual standstill, how many today are capable of dispensing notes of the Rs 200 denomination?
Political critics of the BJP are secretly thrilled at the second edition of the monetary farce, hoping it will pay electoral dividend in Karnataka. Yet along with massive frauds in the banking sector the common man is left wondering if the mismanagement of monetary affairs will have a spin-off that lingers beyond 2019.