To better understand the impact of 8/11, I interviewed a few people who I had the opportunity to meet over the past few days. I’ll leave it to you to arrive at your own conclusions.
The Punjabi lady nearby: Her husband and son run a chicken-tandoori-tikka shop, half-legal, and probably a Grade III outlet as defined by the Bombay Municipal Corporation. They started this shop around thirty years ago and were dirt poor around that time. They’re hardworking. The men return in the early hours of the morning with their hands red from the tandoori masala.
They make a neat pile. I couldn’t and didn’t ask how much. The Aunty runs her own business on the side which, in very polite terms can be described as financier, real estate agent and debt-collector rolled into one. She has the knack of picking up the most likely defaulter for her “interest-free but 400% profit-share” loans business and therefore she is quite successful at evicting them from their own property. Most of this, I presume, is out of illegal chawls that are aplenty in Mumbai, but rumour has it that she owns a few flats in fairly upmarket areas. She is famous for betting Rs 1.00 lakh on the Indian team for the 2013 World Cup win. She took home Rs 10.00 lakhs.
All this is stuff I know already about her. I met her near in the lift few days ago, and though I didn’t want to get friendly with her, I wanted to know how much she lost.
She definitely isn’t happy with the demonetization, but for entirely different reasons – she was upset that her borrowers will now cook up some new excuse and she will have to put more effort in getting the loans back. As for her own money: “Jo mere balance mein tha, bank me dal diya. Tax katna hai toh katne do” (The balance I had, I put it in the bank. Let the tax guys do whatever they want).
The Gujarati-Jain uncle nearby: He is one of several brothers and cousins who run retail and wholesale businesses in hardware, sanitary-ware and electricals. Quite cash-rich – they bought their flats in our building in 100% cash, and that’s a tidy sum. But their frugal lifestyle doesn’t reveal their wealth. How do they manage after demonetization? I presumed they would be unhappy. Nope.
They paid advance salaries to all their staff in old notes. They also paid off a few creditors in old notes. He explained to me how the business works, but I got confused and wasn’t able to follow him. The crux of it is that he managed easily, no real issues, thanks to good relationships, including family and caste ties with their suppliers and large customers. Their retail business is down almost 100% – not a single walk-in customer has bought from their store since 8/11 – and some large builders have postponed their orders. But they’re well-covered and have been so for generations irrespective of the vagaries of the economy. They’re sure that business will pick up soon. A tidbit: they are expecting a shortage of foodgrain and pulses in the coming weeks and have stocked up.
Politically, they have been BJP supporters since the 1990s. He talks of the Prime Minister as if he’s some distant cousin: “Naatak ka bahut shauq pehle se hi tha usko” – he’s always been a showman. They have been donors to the party for a long time. He is ambivalent about the demonetization move – thinks it was unnecessary.
The Marwari medical shop owner brothers: Both are their early thirties and run a modest medical shop in the apartment complex. The complex isn’t large enough to need a dedicated medicine shop, and they hardly get more than ten customers a day. But they’re rich – they’re stock market players.
There’s no significant impact of demonetization. Whatever cash was in the till, they deposited it in the bank. All of their money is white. Do they pay taxes? He laughs. “Never paid income tax in my life. We have a chacha who is a Chartered Accountant. He takes care of these things for the whole family.” They don’t have any strong opinions on the demonetization move. Some of their friends may be in trouble but they’ll manage, is what they feel.
I’m still figuring how making tonnes of money and not paying any income tax works. Stock tip: discard IT, buy Banking and Financial Services.
The painter and the plumber: Two brothers of a five-brother-two-sister family, they stay in an illegal chawl nearby.
Their income from retail customers (flat-owners) is down considerably – no new work and almost all pending work got cancelled after the demonetization. They didn’t lose any money – they recently pooled all their savings (two of the brothers recently returned from Saudi Arabia) and bought a flat adjacent to their chawl in a 100% cash deal. They have a few thousand rupees in the old notes which they have partially exchanged.
Do they have a bank account? Yes, but they don’t use it at all. They opened the accounts to receive cash from some government schemes they had enrolled in, but didn’t get the approval because they lacked a proper address. They have a few upcoming projects with a couple of big builders and now would like to start insisting on cheques, but they don’t seem hopeful of the builders agreeing. One of them is owed a tidy sum from a builder but doesn’t want to collect it right now for fear of being paid in old notes.
I enquired on why they hadn’t operated their bank accounts. They said, “We don’t know what the government will do with our money. See what they did now?”
Apparently, quite a few of their neighbours are in serious trouble because all their savings are in cash which they’re unable to deposit or exchange. Several of them have returned recently from the Gulf and most of them believe holding money in banks is against their religious tenets.
Young IT engineer, next door neighbor, single: Zero impact. Fully digital. Walks 15 minutes to the office, and uses the auto-rickshaw in case he’s late. Has a few Rs 100 notes to manage emergencies. Box8 for dinner, Sodexo card for breakfast and lunch, and everything else is usually credit card or PayTM.
For some reason he’s run up a debt with a paan-beedi shop near his office for his cigarettes and chewing-gum. He plans to settle it with the new R2K note he is expecting to withdraw once the ATMs start functioning. Happy with demonetization, and of course, the Prime Minister.
Rickshaw driver: Rides are significantly down, around half of what he used to get. But what irritates him the most is the R2K note – there’s just not enough loose change in the market and everyone has only THAT note. He’s had to refuse rides because people aren’t ready to part with loose change.
He had some savings in old notes which he deposited in his SBI account. He has another account with a cooperative bank where most of his life’s savings are – but the bank hasn’t opened for regular business. It’s been shut for most of last week for unknown reasons. He is a little worried about what that may entail for him (Cooperative banks have a history of dodgy practices).
He is quite opposed to the move. I don’t know if that’s because he’s a Shiv Sainik.
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This is only an anecdotal survey, and is hardly representative of any community. The only conclusion that I can arrive at is that it isn’t the same for everyone. Your experience is very different from many others’, and sometimes broadening your perspective helps.
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