More radical reforms on cards, hints Narendra Modi

Mumbai: Prime Minister Narendra Modi said on Saturday that the beginning of the end of corrupt people in India had begun with his government’s demonetisation move, and vowed that the fight would continue till it was won with support from the country’s 125 crore people.

The PM hinted at unleashing more radical reforms, saying his government would not shy away from taking tough decisions that were in national interests, asserting that his aim was to make India a developed country in one generation.

The PM spoke at separate events. He first inaugurated the new campus of the Sebi-run National Institute of Securities Markets (NISM) in Raigad, then performed rituals for the start of a Rs 3400-crore Shivaji memorial and launched infrastructure projects in Mumbai before moving to Pune where he laid the foundation stone for a Metro project and said that the importance of India’s currency had increased after his government recalled high-value bills last month.

The PM said that people had remained firm on his side following the demonetisation decision despite facing a lot of inconvenience. “On November 8, we made the biggest attack against black money and counterfeit currency. The 125 crore people of this country went through pain but did not leave me for a moment. Attempts were made to scare them, rumours were created but people did not get carried away,” Mr Modi said, while addressing a rally at Mumbai’s Bandra Kurla Complex after performing rituals for the memorial.  

He said after 50 days (since demonetisation), the hardship faced by the honest would start to ease, but problems faced by the dishonest would increase. PM Modi’s announcement to a stunned nation that he would scrap 86 per cent of the cash in circulation led to a crippling cash crunch. Long queues have stayed outside low-on-cash banks and ATM kiosks, prompting an unrelenting Opposition attack on the government.

The PM said that demonetisation was a short-term pain for long-term gains. “The true measure of success (of our economy) is the impact in villages, not the impact in Dalal Street or Lutyens’ Delhi,” he said while inaugurating the NISM campus. The Opposition has questioned the government’s move to promote digital transactions, calling it a cover-up for “no real black money windfall” for the economy after the demonetisation of Rs 1,000 and Rs 500 banknotes.

He said that the government would unveil more long-term policies that are stable and sound to sustain the higher economic growth rate. “There is an economic slowdown, but India remains a fastest growing economy. My aim is to make India a developed country in one generation,” the PM said.

He favoured increasing tax contribution from various market participants in a “fair, efficient and transparent way”. Asking the regulators and taxmen to think about the contribution of market participants to the exchequer, he said, “The low contribution of taxes may be due to the structure of our tax laws. Low or zero tax rate is given to certain types of financial income.” The PM’s remarks assume significance ahead of the Budget to be presented in the first week of February.

Despite lingering disagreements between the Centre and the states over the dual control of the GST mechanism, Mr Modi expressed hope that India’s biggest tax reform would be a reality soon.

A constitutional amendment enabled the long-awaited Goods and Services Tax or GST but differences have held back its rollout that will turn India’s economy into a single market, broadening the tax base and making life simpler for businesses that now pay a host of central and state levies.

In Mumbai, the PM was accompanied by governor Vidyasagar Rao, chief minister Devendra Fadnavis and Shiv Sena president Uddhav Thackeray. The PM sailed in a hovercraft from Girgaum Chowpatty beach in south Mumbai to reach the site of the memorial.

Taking a dig at the Congress, the PM said that even after Independence, India was still unable to achieve development and eradicate poverty. “Had the previous governments taken development as their priority, many of today’s problems would not have occurred. They (UPA rule) kept the rural people in darkness for 70 years. They were forced to live in 18th-century-like situations. Will they be forgiven for this?” he asked.