The government’s decision to demonetize the Rs 500 and Rs 1000 notes has been called the biggest economic decision in the country since the LPG reforms of 1991. While the clear impact of this monumental decision would only be clear after a few months, it is worth contemplating what the next move of the government would be for the country’s economy.
Though the initial motive of the government behind this move was to fight black money and money laundering, the government changed its tunes at a later stage and focussed on the push for a cashless economy using digital payments. After the decision was taken, the number of cashless transactions has seen a major increase. Digital wallets such as PayTm and UPI have also seen an unparalleled rise in the number of daily transactions. While a complete transition into a cashless economy would still take a good number of years, this decision has set the ball rolling and it would only increase such transactions.
One of the most burning topics of debate in the country for many years has been the system of caste based reservation. While the provision of reservation was initially meant to be a part of the constitution for only a few years, it has now become an almost permanent fixture of the constitution with no political will to take it back. The central ideal behind giving reservation was to undo the years of injustice done to the backward castes at the hands of the upper classes. But now with the backward classes strengthening themselves financially, the need for such a reservation needs to be re-evaluated. For instance, son or daughter of a Supreme Court judge or a well established doctor would get reservation only because he belongs to a SC or a ST. This is unfair to the deserving students who are left behind only because they are not from SC or ST. A re-evaluation of reservation on the basis of the real financial status is the need of the hour.
With a number of world renowned companies including Google and Microsoft appointing Indians are their top executive, the focus has shifted on the issue of brain drain all over again. This can be rooted back the reservation policies which overpower talent in the country.
A large subsidy bill for the government is majorly due to the welfare schemes run by the government aimed at empowering the BPL families. However, such BPL records are out of date with many beneficiaries actually having a considerable bank balance and have no need for government’s help. Thus, redefining BPL and the families covered under it would serve the country and its economy very well.
A country can’t expect to reach all the possible heights unless merit is given the top priority in the country in place of reservation or out of turn favours. Though demonetization is a major move to boost the country’s standing, not much would change unless all these steps are taken in the near future by the government.