Cash by itself is not black. Cash is notes or coins that are underwritten by the RBI and guaranteed by the Central government, hence it is all legal tender.

The denial to honour or exchange cash is a direct threat to our right to life. If a person cannot use her cash to buy food, how is she supposed to survive?

The government is duty-bound to honour or exchange cash. Additionally, there is no constitutional basis for limiting cash withdrawal or exchange. No law makes it compulsory for a citizen to hold a bank account, nor does it place a limit on how much cash can s/he hold.

As such, the entire exercise is patently illegal and unconstitutional. Simply put, it has no basis in law. The idea that one has access or needs to open a bank account to exchange cash is absurd. The banks, already loaded with additional work, are simply refusing to open new bank accounts.

Millions of farmers, labourers, auto drivers, small shop keepers, housewives, young working women and even more millions of poor people have kept their small savings in the high value notes which are now worthless.

The situation in the rural areas is beyond redemption. Why, you ask? Well, India has a total of 36,350 banks in 5,93,731 villages. That’s just 1 branch for every 16 villages.

Forget the supply of money, there are just not enough bank branches or ATMs to facilitate the exchange or disbursal of new currency notes. As of today, even the exchange of Rs. 2,000 has been stopped. The Government has abruptly pushed a large number of citizens deep into the throes of poverty.

This is criminal.

  • In a country where thousands of villages are without electricity, the Government has chosen to announce policy decisions through television channels and press releases. Many a times, even the banks were not aware of the updated rules. Bank computer systems have not kept pace with the changes announced every evening.
  • Protesting voices are being silenced by labeling them ‘black money hoarders’, as if every citizen who is tired of lining up at the bank is holding black money. Worse still, there is no regard for the millions who would be going hungry due to the shortage of new currency. There is no acknowledgment of the fact that this has affected the poor disproportionately. Tears don’t assuage hunger, real food on the table does.
  • It is the government’s job to collect taxes; at which they have failed miserably. Only 1.25 crore citizens paid taxes in 2012-13, the average tax paid was only Rs. 21,000 per person. Instead of reforming and strengthening the tax system, the government has decided to wipe the slate clean by demonetizing the currency itself.
  • Worse still, this move only (if at all) attacks the stock of black money held in cash - going by estimates, about 6% of the total black money. It does not attack the 94% held in assets like gold or property, nor does it address the flow of black money. Reports suggest the standard rate for bribes is only going up, although they continue to take the demonetized notes.
  • The income tax department can only scrutinize about 3.5 lakhs cases per year. 30% of their sanctioned positions are vacant. There are not enough income tax department employees to keep a check on what is happening. No efforts are being made to shore up the capacity to ensure that culprits will be nabbed.
  • The actual position of notes printed and ready for supply is suspect. Expert evaluations suggest that it might take up to 7 months to just print the notes; even more to distribute.


The Government has reneged on its guarantee by failing to ensure adequate availability of cash, especially in rural areas. New currency notes have not been supplied in adequate numbers to rural areas, which is where most of the 165 million unbanked live.

They have also failed the guarantee of paying the money promised on the notes, a direct breach of contract with the 1.3 billion citizens.

History will not be kind to the Government of the day. I just hope that ‘today’ won’t be kind either.

My rural brother and sisters, I am sorry. We the ‘educated’ middle class just failed at defending our rights and have enabled your mass plunder. Please fend for yourself.

(Ahmer has worked in the development sector for almost 20 years. He is a keen student of data, marketing and human rights issues)

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