Behind the smokescreen of clever mythology, it was they, who grabbed the lion’s share of everything tangible over the centuries – from land, water, natural resources to hard political and social power. Worse still, using a mix of brute force and religious mumbo-jumbo, they consolidated the exploitation of those who work by those who merely cook up tall stories, through the nightmare of the caste system.

Today the politics of Maya is well and truly back in play with Narendra Modi’s ‘Mahayagna’ a.k.a. demonetisation promising a digital Moksha through the tapasya of a ‘war on black money’. Once again, as in India’s sordid past, the biggest losers of this devious push for a cashless economy are going to be those right at the bottom of the Indian caste hierarchy.

From all evidence so far it is clear, that the Scheduled Castes and Scheduled Tribes, who make up a bulk of those surviving off India’s vast informal economy, are the worst affected by the sudden disappearance of cash from the economy. Labour in agriculture, construction, fishing, textiles, micro-enterprises, the urban and rural poor – mostly from these marginalized castes – have been pushed to the brink of starvation or worse due to loss of jobs and income.

The other sections hit hard, are small and medium sized farmers, who are overwhelmingly from the different Backward Castes and artisans, mostly from poorer Muslim communities. It is true that demonetisation has also hit the economically and caste-wise better off trading communities, but they seem to have been sacrificed in the quest for complete domination by global and national corporations – who pay our politicians to run the country on their behalf.

The most apt way to describe what is happening in India today is perhaps through a completely new term – dwijitalisation. Under the new rules of the dwijital economy only the dwij – or twice born as the Hindu caste elite call themselves – will climb still higher up the social and economic hierarchy, while kicking the ladder down to ensure no one can follow.

Dwijital India will thus continue the rigid division of ‘duties’ along caste lines that has been used for centuries to enable the free transfer of energy and resources from those below to the ones at the top in various ways.
The Purusha Sukta, a hymn from the ancient Rig Veda, used the analogy of the human body to describe the social hierarchy clearly.

The Brahmin priest/philosopher is the mouth, the Kshatriya or warrior the arms, the Vaishya or businessman the thighs and the Shudra or worker is right below as the feet. Those who have to deal with human or animal wastes are much worse off, relegated outside the pale of the caste system itself and rendered ‘untouchable’.

At its core the idea, which forms the theoretical basis for the Indian caste system, is that the mind and its creations are noble and permanent while the body is impure and ephemeral. Mental work (software) is superior and hence deserves a regular ‘transaction fee’ (think Paytm or Jio Money) from those who perform physical work (hardware), that is inferior.

In more recent times and through the colonial period, traditional caste privileges and inherited wealth were combined with access to modern education, to create the Indian ruling elite – family-run industrial empires, big landholders and a bureaucrat/politician nexus that today have a complete stranglehold on state power. There is also a sizeable Indian middle class serving the system, that claims its prosperity is due to a mix of merit (ability to pass exams), hard work (long hours in the office)  and honesty (taxes deducted at source).

Together, all these sections of Indian society, have made best use of new opportunities thrown up by globalization, to establish a society which is easily among the most unequal ones in the entire world. Just 1% of the richest Indians control over 58.4% of the country’s wealth[2]  while the top 10% account for 80.7%. The bottom 50% of the population fights for its share of a mere 2.1%.

The Modi regime’s current campaign against corruption does not even begin to address the structural bias of the social and economic system in favour of those who have been long-term beneficiaries of illegality and immorality in different forms. Instead, it uses racist tropes to describe ill-gotten money, equating white with ‘good’ and black with ‘evil’. One Modi cabinet minister even called the anti-corruption campaign a war on ‘asuras’ – the dark skinned indigenous people who were conquered by upper caste migrant populations in ancient India[3] and commonly figure in Hindu mythology as ‘demons’[4].

Of course, caste discrimination was acknowledged at the time of Indian independence from British colonial rule, thanks to numerous struggles by the oppressed castes. This was reflected in affirmative action policies of reserving a certain percentage of government jobs and admission to educational institutions, as also financial support through loans and special schemes, for these castes.

However, all these measures have been half-heartedly implemented and  are so woefully inadequate, that  seven decades later there is not a single positive indicator of social development where the Scheduled Castes or Scheduled Tribes figure anywhere near the top. Whether it is land holdings, income, literacy, nutrition or health status it is these sections – who constitute one-third of India’s population – that are right at the bottom of the pile.

For example, according to the Socio-Economic and Caste Census of 2011, 54% of those from the Schedule Castes were landless, while Scheduled Tribes –despite having somewhat better land ownership were even more deprived due to lack of cash income[5].  Together these two communities form the most vulnerable section of India’s population.

Economic vulnerability is reflected in the dire health status of these populations too. In 2015 India recorded the largest number of under-5 deaths in the world, at 1·3 million[6] – most of them children from Scheduled Caste and Scheduled Tribe families. Again among these populations, more than 50% of the people have a body mass index below 18.5, which is regarded as chronic sub-nutrition[7] – placing them by World Health Organization standards – in a permanent state of famine.

Today, on top of all this, without functional literacy, technological skills or access to  basic infrastructure, these communities are being subjected to a test in digital dexterity impossible for them to get through any time soon. Think about it like this. If someone denied Albert Einstein his daily meal because he could not prove his mettle by playing cricket or made Sachin Tendulkar homeless for failing a quiz on quantum physics they would immediately be denounced as being either mad or extremely evil.

And yet that is exactly what the Narendra Modi dispensation has done through its demonitisation decree, imposed on the already disadvantaged, a test designed to not just make them fail but also put the blame for their misery on their own ‘ignorance’.

If there is to be a fightback against such injustice there are three cardinal lessons to be learnt from the history of the Indian caste system and clever myth making.

One is that blatant lies from those in power cannot be fought with the weightiest of facts because the former is backed by force while the latter is not. In other words, remember when the rulers invite you  for a ‘dialogue’, they are in fact deploying an iron fist in a velvet glove.

Second – always look behind the Maya of religion, nationalism, culture  to find out who controls things that can be touched and felt i.e. who benefits and gets to own tangible wealth. Everything else is poppycock
The third and most critical lesson to pay attention to is – STOP ARGUING, START ORGANIZING!
 
Satya Sagar is a journalist and public health worker who can be reached at sagarnama@gmail.com

Courtesy: Kafila.online
 
[1] To be more precise, the claim was, we are all part of Maha Vishnu’s dream as He sleeps peacefully on a giant serpent, with a lotus blooming from His navel.
[2] http://www.livemint.com/Money/MML9OZRwaACyEhLzUNImnO/The-richest-1-of-Indians-now-own-584-of-wealth.html
[3] http://www.thehindu.com/news/national/It-was-an-attack-on-four-%E2%80%98asuras%E2%80%99-Parrikar/article16668448.ece
[4] https://www.britannica.com/topic/asura
[5] http://indianexpress.com/article/india/india-others/landlessness-is-higher-among-dalits-but-more-adivasis-are-deprived/
[6] Global, regional, national, and selected subnational levels of stillbirths, neonatal, infant, and under-5 mortality, 1980–2015: a systematic analysis for the Global Burden of Disease Study 2015; GBD 2015 Child Mortality Collaborators; http://www.thelancet.com Vol 388 October 8, 2016
[7] http://www.governancenow.com/views/interview/india-facing-stable-famine-situation

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Photo Credit: Skoch Group

Amid the tales of mass misery and deaths due to cash crunch caused by his decision of demonetization, Narendra Modi asked people to go for digital transactions and in one stroke overtook Marie Antoinette, who is reported to have asked people suffering due to widespread bread shortages, to eat cake. Historians are not sure about the queen having ever said it, but the entire nation has been witnessing Modi’s high pitched exhortations to have cashless transactions through digital media.

Marie, with her royal lineage said it in feudal France three centuries ago, Modi claiming to come from a humble chaiwala family with his mother working as a maid servant in others’ houses says it in a democratic republic of India in 2016!

Marie, with her royal lineage said it in feudal France three centuries ago, Modi claiming to come from a humble chaiwala family with his mother working as a maid servant in others’ houses says it in a democratic republic of India in 2016!

The drama of war against black money, terrorism and counterfeit currency through demonetizing the 500 and 1000 rupee notes has completely exposed the political unscrupulousness of the BJP and narcissist haughtiness of Modi. Leave apart catching black money, demonetization opened new avenues of making black money. The anger over the untold sufferings it unleashed on already distressed rural population haven’t flowed onto streets as even the Supreme Court apprehended but may have its date in coming elections.

The new ploy of promoting digital transactions is nothing short of rubbing salt on the wounds of millions of the working class. BJP is blissfully complacent with its victory in civic polls in five states that took place after demonetization was announced. It took it as the approval of demonetization by the people and thankfully appears out to repeat such blunders to its own peril.

Cashless Fantasy

Modi has mesmerized people with his theatrical skills and gift of the gab, giving them many slogans like “digital India”, “make in India”, “Startup India”, “swachh Bharat”, “sabka saath, sabka vikas”, etc. but halfway through his tenure, could not deliver on any of them. The cashless economy is the most fantastic of these slogans that he has come out with just to distract public attention from catastrophic demonetization.

When he announced his decision on November 8, he had mentioned “black money” 18 times in his speech and did not talk even once about cashless or digital economy. After 20 days when his bravado could not contain the disastrous consequences to people and mounting criticism of this inept act, he swiftly changed the goalpost and began talking about“cashless” and/or “digital” economy. This term occurred 24 times in his Mann ki Baat on 27 November, when he first mentioned it whereas black money occurred only nine times.

The queues in front of banks and ATMs had not yet ended but the discourse was successfully diverted towards cashless transactions. In the face of horrific empirical reality even the sarkari intellectuals felt embarrassed to speak with conviction for demonetization, but most of them began comfortably speaking in favour of a cashless economy. The spurt in use of digital wallets post-demonetization emboldened them to project that India was already ready for the ‘cultural revolution’ as BJP’s Venkaiah Naidu claimed.

Can India really be a cashless or even as Modi corrected himself later, less cash economy in the near future? As of now there is no definition of any of these terms and they only connote relative standing of economy in terms of the usage of physical cash. For instance, the Mastercard report on measuring progress toward a cashless society (2013)[i] categorized countries into four classes: inception (where cash accounts for 90% or more of all consumer transactions), transitioning (where cash transactions account for between 80–90% of consumer payments), tipping point (where cash transactions account for 55-71% of consumer payments) and advanced (where nearly everyone has at least a debit card and merchant acceptance is nearly ubiquitous).

According to this report, India is placed in inception category at only 2% of consumer payment transaction done using non-cash methods as compared to the advanced category cases of Singapore (61%), Netherlands (60%), France and Sweden (59%). The report presented trajectory score (growth during the previous five years) of cashless transactions for the subject countries.

As against Singapore (39%), Netherlands (20%), France (14%), Canada (16%), India’s score was 11%, far behind some of the members in its category such as UAE (65%), South Africa (53%), Kenya (51%), and even Nigeria (12%). The report listed pre-requisites for going cashless and estimated readiness score for various countries. Sweden scored top at 89, Singapore 80, Netherlands 88, France 74 and India just 29, behind even the countries like Kenya at 30, Thailand at 48, and Malaysia at 56. It should be clear that India is not ready to go anywhere near cashlessness at least during Modi’s tenure.

Daydreaming Digital

Digital money may be desirable but its proliferation presupposes financial inclusion of all people, macro-economic and cultural factors; merchant scale and competition; and technology infrastructure. Towards financial inclusion, the government has made some progress by opening 256 million bank accounts for the poor. Many of them under the Prime Minister’s celebrated Jan Dhan Yojana, however, are the second accounts, a quarter of them being zero- balance non-operative accounts, and therefore a burden on the banking system. With regard to accessibility of financial services, there are about 2 lakh bank branches for a total of 6.5 lakh villages; 2 lakh ATMs, mostly in cities, 85% of which are still running on outdated Windows XP.
 
Thus, a large population of the country still does not have access to financial services. Even if the financial services reach out to all people, a vast majority will still be excluded simply because they do not have money. The NCAER-University of Maryland’s income based survey (2011-12) established that for the lowest percentile of population, consumption is about twice the income, and everybody up to 33^rd percentile consumed more than their income. Are these people expected to transact digitally?  
 
The spread of mobile telephony is flaunted as the platform to leapfrog into digital space. The latest figures from the Indian telecom regulator TRAI show that, as of 31st July 2016 , India had a teledensity of 83%. This may, however, need correction because it is based on the number of connections and not users. With many people using multiple SIM cards, this number may be scaled down significantly. There are about 350 million Internet connections of which about half are on broadband (3G + 4G + wireline broadband).
 
For the top four telecom operators, the number of mobile connections (smart phones) that are data enabled is just about 30%. There are total 6 crore debit cards and 2.5 crore of credit cards, which are barely accepted in cities. This is not the infrastructure for 1.3 billion people to go cashless.
 
The security infrastructure required for digital transaction is still not up to the mark which does not induce confidence even in educated people to transact online. Today, 95% of all transactions take place in cash and only 4% people do online shopping, most of which with cash on delivery. With 90% of India’s workforce in informal sector that runs on cash, Modi-speak makes a pure daydream.
 
Aata or Data

There are apparent advantages of digital money over paper currency. But to assume that everything is green with it will be grossly erroneous. Paper currency costs to produce and runs a risk of being counterfeited but then digital money is not free; taking current commissions being charged by the payment platforms, the cost of digital transactions could run into thousands of crores of rupees. A currency note incurs cost of production and logistic for its circulation but it copes with on an average 100,000 transactions. If its cost is spread over these transactions, the per-transaction cost is almost zero.

Contrast it with the cost of digital transaction either by credit/debit cards or e-wallets. They charge anywhere between 1 to 4% of transaction value. As the user base widens these unit costs are expected to come down but not completely vanish because their issuers’ business model is premised on that revenue stream. The digital money, moreover, suffers from various security risks. In course of time, like costs, risk associated with digital money also may come down but they can never be zero. Eventually, these risks and costs shall be borne only by common people.

Basically, digital or physical, it is a question of money which the majority of people simply do not have. Digital money may suit Modi to score political mileage, hyping it as development but it should be understood that there is no essential difference between the physical and digital money, insofar as they both constitute liability of the issuer and operates as a transferable claim in transaction mode.

Digital currency tends to increase velocity of money and become virtual. Virtual money is just a digital representation of value, which is issued and usually controlled by its developers. If digital money is transacted between person to person (P2P) and used in the real world for physical goods and services, it remains digital but if it is used only for virtual world purchases in closed loop systems, then it turns virtual. The intrinsic tendency of digital money to become virtual is hugely speculative.

Then why is Modi after cashless economy? Cashless economy makes it difficult for many in informal economy to escape the tax net and significantly add to the indirect taxes when GST is implemented. Already, indirect tax contributes two-third of tax revenue; its increase would enable dampening of direct taxes on wealthy.

Politically, it lends complete control over people because they can now be profiled with their transaction data and targeted for effective surveillance. It directly benefits digital wallet companies like PayTM, which is said to be making Rs 120 crores per day since demonetization was announced and surged in its valuation by 4.7%. The space has already attracted many players but in the long run the winners would be those platform-gateway companies which also sell data. Reliance can surely be named because its Jio strategy catapults it to be the lord of the digital world. The vast majority however will be forced to buy data over aata (ration).

Marie Antoinette’s impudence led to the French Revolution, to the overthrow of the monarchy and to her being guillotined. Can we not hope for a small change in India!       

(This article has also appeared in the Economic and Political Weekly and is being reproduced here with the permission of the author)

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