government’s reformist stance is appreciable and is set to usher in much-needed changes in the economy. but be it the denotification of higher currency notes or country’s shift from multiple indirect levies to goods and services tax, almost every policy decision fell short of realizing its real and desired outcome.
demonetisation was targeted at checking corruption and black money, but bankers made fortunes out of this exercise. reason – the agency that planned the execution of this decision could not anticipate corruption by one of the implementing hands, the banks. not only notes were exchanged on fake identification documents, atm queues and misbehavior at branches added to the woes of already panicked currency holders.
demonetisation was the first policy action that separated the present dispensation from former governments as this was not only a bold transformation, it also was greeted with cheer from the public at large; however the push behind this wide acceptance was related more with modi’s god-like figure and patriotic fervor, less with any element of pragmatism.
not only these bank officials, at least of public sector banks, steered clear of punitive actions for their gross mismanagement during demonetisation, even those who assisted in illegitimate conversion and deposit of denotified currency escaped disciplinary action. the result – a surge in the sentiment that being a psu bank employee or for that matter any government official is akin to owning the shield of impunity.
in case of goods and services tax, the government relied heavily on the already established tax officials, mainly comprising of chartered accountants and law practitioners. with every single business, barring a few, under the purview of this new tax regime, the government has offered a lucrative opportunity to these tax consultants disregarding the possibility of using this as a golden chance to create new jobs.
tens of thousands of new jobs could have been created for gst professionals, a new category of indirect tax consultants, by roping in graduates from tier 2 and tier 3 cities and rural parts and skilling them for a few months on how to assist small and medium businesses on gst compliance. this was where the government should have doled out subsidy by distributing laptops and software on soft loans to these new professionals, thereby ending anxieties of small businesses with no technical infrastructure to comply with gst.
reforms need sincere brainstorming not only on what reform has to be brought in but also while planning detailed execution of that policy decision. the government is yet to come up with reforms, we shall be better placed if their implementation is properly planned and any diversion from what is formally mandated is both punished and publicized.