In his much-awaited New Year eve speech, Prime Minister Narendra Modi announced a slew of sops for the poor, farmers and small traders, the groups perceived to be worst hit by the November 8 demonetisation that caused widespread economic upheaval in the country.
In what sounded more like a budget speech, Modi announced interest subvention on housing for the urban and rural poor, provided enhanced credit guarantees to small traders and MSMEs, gave a 60-day interest waiver on select farm loans and ensured higher interest earnings for senior citizens.
Terming demonetisation as a “historic cleansing ritual”, Modi said people of the country had taken the biggest “shudhi yagna” after Diwali, and had, through their stoicism in the face of adversity, proved that a majority of Indians wanted freedom from corruption.
The opposition, however, was not impressed. Congress spokesperson Randeep Surjewala called Modi’s speech underwhelming. “Khoda pahad nikli choohiya” (Much ado about nothing), he said.
West Bengal Chief Minister Mamata Banerjee, the most strident critic of the demonetisation move, said: “Modi babu is serving his selfish, personal agenda.” She promised that 2017 would be the year of “deModitisation” of India.
Modi, in his 45-minute speech — first in Hindi and then English — announced that the government would give rebates of four and three per cent for home loans of up to Rs 9 lakh and Rs 12 lakh, respectively, under the Pradhan Mantri Awas Yojana.
He also directed cash-rich banks to go out of the way to help the not-so-privileged and asked them to raise the working capital limit for small businesses from 20 to 25 per cent.
The Prime Minister said the government has decided to enhance the credit guarantee for Micro Small and Medium Enterprises (MSMEs) from Rs 1 crore to Rs 2 crore.
Assumed income of businesses with turnover of up to Rs 2 crore will be calculated at 6 per cent of the turnover instead of 8 per cent, thus effectively reducing their tax liability by 25 per cent, he said.
Possibly keeping in mind the model code of conduct that will come into force once elections to five state assemblies, including in Uttar Pradesh, are announced next week, the Prime Minister flagged off several schemes aimed at helping the poor.
Farmers who have taken loans from district cooperative banks and societies have been granted waiver on interest for a period of 60 days. “The amount of the 60-day interest waiver will be directly transferred to the farmers’ accounts,” he said.
He said three crore farmers who have the Kisan credit cards would be given the RUpay debit cards to help them in retail payments.
Pregnant women across India, Modi said, would be given a support of Rs 6,000 to take care of their initial medical needs.
Striking an emotional note in his pre-recorded speech with visible editing cuts, he lauded India’s “125 crore people” for “bearing with the pain” of the demonetisation, and said thousands of people had written to him about the hardships they faced.
He thanked people for standing by him despite all the inconveniences which have been brought about by the policy of banning Rs 500 and Rs 1,000 currency notes.
“Indians have displayed the strength of people power, utmost discipline and the ability to discern the truth in a storm of disinformation. They have shown that resolute honesty, can defeat dishonesty,” he said.
He said the note-ban policy was aimed at the dishonest and to rid the nation of black money. “Corruption, black money, and counterfeit notes had become so rampant in India’s social fabric, that even honest people were brought to their knees,” the Prime Minister said.
Lauding bank officials for their “Herculean effort”, Modi nevertheless said that those officials, who may have dishonestly helped people convert their illicit wealth, won’t be spared.
The Prime Minister, however, didn’t give any figures on the amount of old currency deposited in banks after the demonetisation move.
His failure point out obvious benefits from the note-ban drew flak from some opposition parties.
“Prime Minister has failed to tell the nation what the government achieved from demonetisation, how much black money, fake currency and deposits in foreign banks came back,” CPI leader D. Raja told IANS.
Raja said the Prime Minister made the announcements keeping state elections in mind and wondered what Finance Minister Arun Jaitley would announce in his budget speech.
Delhi Chief Minister Arvind Kejriwal said the Prime Minister sounded “hollow” and people had stopped believing what he says.
“He has become a subject of ridicule internationally,” said Kejriwal.
In an obviously laudatory comment, the BJP Chief, Amit Shah said the announcements by the prime minister would give a strong impetus to housing for the poor.