How China Should Learn Lesson From India’s Currency Ban
Like India the communist Asian country too has been fighting against corruption, but until now differently. The latest move of Indian Prime Minister Narendra Modi of demonetization has received a good version from China.
The Chinese government lately classified the ban of two biggest denominations of currency notes in India as “very bold” step and they will draw lessons from impact of it on corruption.
Official media of China the ban was a gamble and would create a precedent irrespective of whether the mission succeeds or fails.
The state-run Global Times carried an editorial titled ‘Modi takes a gamble with money reform’ and writes it is not imaginable what the bold would result in China if the country bans 50 and 100 yuan.
The biggest currency note in China is 100 yuan.
The editorial added further, “To prevent a leak of information jeopardising the implementation of the demonetisation reform, the roll out of the plan had to be kept confidential. Modi is in a dilemma as the reform aims to render the black money useless but the process goes against the governance principle of winning support of the public before initiating a new policy”
Criticizing former Prime Minister Manmohan Singh and his comment the note ban is organized loot, the column mentioned India is a country where more than 90 percent of transactions are made with hard cash and the move in such situation brings a lot of trouble to the daily life of people.
However, the move can help in bringing down shadow economy and corruption, but it is not yet very clear whether it can solve deeper social and political issues.