The beating to cash-driven sectors like gold and real estate notwithstanding, Indian industry is gung-ho about the Prime Minister’s decision to derecognise notes.
PRIME MINISTER NARENDRA MODI ’S announcement derecognising Rs.500 and Rs.1,000 notes came when most shops in Mumbai were seeing end-of-day sales or were about to down their shutters. “Within an hour of the announcement there was a massive rush and we remained opened till close to midnight,” says Navin Jhaveri, a jeweller in the Opera House area which houses upmarket jewellery stores.
The days and nights that followed November 8 at the city’s Zaveri Bazaar, one of the central points for precious metal and jewellery trading, resembled the week before Deepavali when people buy a lot of jewellery. Apparently, many jewellers were willing to take cash and give backdated bills for sales. Jhaveri said, “The big loophole in the gold and ornament business is that you can buy jewellery or bullion up to Rs.2 lakh without having to give a PAN [permanent account number]. If the price of the product is above that, the seller has a way of splitting the bills. Therefore, this was an easy way to dispense cash and still hold a good investment.”
Nothing was illegal about it as the seller was giving valid bills and VAT charged, says Jhaveri. “Everything was kosher.” But for the seller who might have, say, 80 per cent of the payments in cheque and 20 per cent in cash, it spells trouble. He does not pay taxes on that cash.
A diamond merchant with a leading company says, “People were going nuts. They would rather take a hit and have something in their hands than lose all the money.” On November 8, gold was selling at about Rs.31,500 for 10 grams. When the currency crisis hit, the price peaked at Rs.60,000 per 10 grams.
According to market estimates, such has been the demand for gold that as much as $1 billion worth of gold, or around 30 tonnes, was imported from November 9 to November 15. On an average 30 tonnes of gold is imported in a month.
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
How Not To Handle An Epidemic
The lockdowns were meant to buy time to put in place appropriate health measures and contain the coronavirus’ spread, but they have failed to achieve the objective and heaped immense misery on the marginalised sections of society. India is still in the exponential phase of the COVID-19 infection and community transmission is a reality that the government refuses to accept.
Tragedy on foot
As the COVID-19-induced lockdown cuts the ground beneath their feet in Tamil Nadu, thousands of migrant workers are trudging along the highway to the relative safety of their upcountry homes.
Sarpanchs as game changers
Odisha manages to keep COVID-19 well under control because of the strong participation of panchayati raj institutions and the community at the grass-roots level under the leadership of Chief Minister Naveen Patnaik.
Scapegoating China
As the COVID-19 death rate spikes and the economy tanks in the United States, Donald Trump and his advisers target China and the World Health Organisation with an eye to winning the forthcoming presidential election.
New worries
Kerala’s measured approach to the pandemic and lockdown has yielded results. But it still has to grapple with their huge economic impact on its economy, which it feels the Centre’s special financial relief package does little to alleviate.
No love lost for labour
Taking advantage of the lockdown and the inability of workers to organise protests, many State governments introduce sweeping changes to labour laws to the detriment of workers on the pretext of reviving production and boosting the economy.
Capital's Malthusian moment
In a world that needs substantial reorienting of production and distribution, Indian capital is resorting to a militant form of moribund neoliberalism to overcome its current crisis. In this pursuit of profit, it is ready and willing to throw into mortal peril millions whom it adjudicates as not worth their means—an admixture of social Darwinism born of capital’s avarice and brutalism spawned by Hindutva. .
Understanding migration
When governments and their plans are found to be blatantly wanting in addressing reverse migration, exercises such as the Ekta Parishad’s survey of migrant workers throughout India can be useful to work out creative long-lasting solutions.
Waiting for Jabalpur moment
The Supreme Court’s role in ensuring executive accountability during the ongoing lockdown leaves much to be desired. Standing in shining contrast is the record of some High Courts.
An empty package
The Modi regime, which has been unable to control the COVID-19 infection, restore economic activity and provide relief to millions exposed to starvation, trains its sights on Indian democracy, making use of the panic generated by fear and a lockdown that forecloses paths of resistance.
