The initiative by the Modi government stems from a desire to fight the counterfeiting of money. However, the surprise move has badly penalised ordinary people. The new notes are not accepted in shops. Bollywood is also in crisis. Media show BJP officials holding the new notes before the announcement was made.
New Delhi (AsiaNews) – A week after Indian authorities decided to pull 500 and 1,000 rupee notes, the "situation has deteriorated. People are crowding the streets, and protests have broken out all over the country. Shops, cinemas and markets are deserted because people don’t have money for exchange,” an anonymous Catholic source told AsiaNews. "Conditions in India are critical and the move by the Narendra Modi government has brought only confusion".
The prime minister recently said that the initiative was kept secret so as not to spoil the surprise effect and make the fight against counterfeiting more effective. However, "several Indian TV stations have broadcast images of senior BJP (Bharatiya Janata Party) officials with new rupees before the operation was launched. This shows that the party knew."
Modi’s decision to withdraw banknotes has disrupted people’s lives, especially among the poor and the middle class. They are the ones standing in the long queues in front of banks, unable to change notes that no longer have legal tender.
"We're going through a really hard time and we hope that all this will end soon,” another source said.
"The government's objective was to fight the counterfeiting of money,” the source added. “For this reason, the central government decided that those who go to a bank or ATMs will be marked with indelible ink to curb attempts at recycling.”
In recent days, many people with large amounts of money from suspicious business went to various banks, exchanging banknotes in their possession and circumventing the maximum amount allowed of 2,500 rupees a day. This is happening "because the government did not adequately organise the process and therefore restrictions have been ignored."
Meanwhile, "ordinary people are afraid to exchange and accept the new 2,000 rupee banknotes. Shops do not accept them because they don’t’ have change. The consequence is that markets are empty and losing money. Even Bollywood is in crisis. Some movies have come out but few people are going to the cinemas."
From a legal standpoint, "nothing can be done,” the source noted. “Protesters have asked the Supreme Court to rule on the matter, but the justices today said that they cannot speak out against the government's initiative because the bills have already been printed and put into circulation."
India's economic decision is also having an impact on neighbouring countries, first of all Nepal where local banks accept Indian currency.
Many Nepalis, usually young people studying in India, lorry drivers and traders, have millions of rupees, which they use in transactions and exchanges.