Comment by ordinarySeeker | Hacker News Reader

Comment by ordinarySeeker | Hacker News Reader

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There is atleast some indication that the Modi government took some steps in the prior years/months to strategically encircle the medium to big hoarders of black money and soothe the impact of the drastic demonetization step on the poor. Having said that any action of this magnitude is bound to have misplanning, unintended consequences and hardship

2013 Under previous government Replace subsidies with direct deposits in bank accounts of poor citizens[1]

2014 Under Modi Massive push to open bank accounts for poor people which seems to have bought banking to many households who never previously had one[2]

2015 Renegotiation of Tax treaties and Information sharing treating with tax heavens[3][4]

Window for hoaders of black money to declare it for a flat penalty[5]

2016 Demonetization

A more detailed step by step account http://indiatoday.intoday.in/story/prime-minister-modi-surgi...

[1] http://www.voanews.com/a/india-replaces-subsidies-for-the-po... [2] http://qz.com/257548/the-response-to-modi-governments-first-... [3]http://swarajyamag.com/economy/campaign-against-black-money-... [4]http://pib.nic.in/newsite/PrintRelease.aspx?relid=146245 [5] http://www.thehindu.com/news/national/10-things-to-know-abou...

The timing is suspicious though, ahead of state elections in the key states of UP, Punjab, Gujarat and Goa. For campaigns that are largely fought on cash, depriving other parties of cash is the biggest advantage.

Better timing would have been to wait until adoption of the Government's own pan-Indian electronic payment scheme ('Unified Payment Interface'), including giving small vendors card reading devices.

>The timing is suspicious though

Well, there are elections every year [1] in India in some or the other key states. Not denying what you are saying but any timing would raise political eyebrows. IMO average citizens have no problem with politicians drumbeating things that has positive impact.

[1] http://www.elections.in/upcoming-elections-in-india.html

There is always a major election coming up in India. By the time we're done with Gujarat (2018), there will be Rajasthan and a few others coming up. Not to mention the next Lok Sabha (Parliament) elections in 2019.

Yes, the timing does mean that major political parties in UP would be hurt because their insane amount of hoarded cash is in trouble but really, is that a bad thing?

As pointed out in comments above, this step does make sense given what the govt. has been trying to do to fight black money in the past 2 years.

In fact Modi keeps mentioning that this is not the last of the steps and there will be more measures coming into affect soon. Keeping the hoarders scared was really needed here.

If you're on the ground in India, you can tell people are thinking twice before selling their properties for cash (it's very common for people to sell for 70/30 or so ratio for white and black money) / other hoarding activities.

The bad or unfair thing is if the BJP is hurt less than its competitors, which is possible if they have more of the newly valid currency to spend. Whether they accumulated this before or after the announcement is irrelevant; but there is now a scarcity which can be manipulated.

> If you're on the ground in India, you can tell people are thinking twice before selling their properties for cash (it's very common for people to sell for 70/30 or so ratio for white and black money) / other hoarding activities.

On the other hand, demand for gold has gone up. That's definitely a more fungible form of black money than property.

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