Views of Pramod Rajpal (ProDot) on effect of Demonetization

I am Pramod Rajpal from ProDot. The recently changed scenario in the country caused due to NoteBandi/Demonetization has divided the whole country into two groups; one group is in support of the decision and calls it ‘good’ for the future and second group is against the decision and say it is ‘bad’. These two groups include political parties, media houses, journalists, economists, celebrities, companies, even religious forums.

Just like every coin has 2 sides, every decision has some advantages and some dis-advantages and both always come together as a package. This being quite a diverse-d decision it is revolutionary, reforming, path breaking, and path changing; although quite beneficial at long term for the country certainly would have some difficulties and problems in the starting phase.

One interesting coincidence is also there if we correlate some recent instances of the past i.e. Uri Attacks, surgical strikes, terrorist encounters, protest against Pakistani actors, NoteBandi; all issues have been highly discussed and debated upon by the media in the recent days. Point to be noted here is that the people who supported all these steps are the same people who support NoteBandi and the people who disagreed with all those acts are the same people who are against the NoteBandi announcement. This proves that all these incidents are not mere coincidences; rather they are 200% political actions.

The above reason shows that different political parties calling NoteBandi ‘good’ or ‘bad’ have their political opinions rather than a logical and thoughtful opinion, which is understandable. You can see the ruling party and its supporters calling it ‘a revolutionary decision’ whereas all opposition parties and their supporters are busy finding shortcomings in the policy, in the process, in timing and calling it ‘a disaster’. Try correlating any person’s political background with his/her positive or negative views on ‘NoteBandi’ and you would easily be able to establish the political connection. People are influenced by the opinions of the political parties they support or are a part of. Interestingly, no one is saying or daring to say that approach is ‘bad’ or ‘wrong’.

Reasons are not political always, sometimes they are against because of their individual loss too as “We find anything ‘good’ or ‘bad’ AS PER it is a beneficial or loss-entity for us.”

Interestingly, there is one category of people who are always negative, always unsatisfied, unhappy or unwilling; somewhat like a Hindi movie character by the name of ‘George Kutty’ played by ‘Prakash Belawadi’ in Akshay Kumar’s famous movie ‘AIRLIFT’. Remember?

So far as charges and allegations are concerned such as ‘information leak’ by BJP to its collection wing or Reliance JIO, PayTm etc. Logically speaking, say if today for constructive reasons the government bans any commodity like cigarette or whiskey or diesel cars then automatically the sale of alternate available products would increase like in this case Beedi or beer or petrol cars, and it is a natural phenomenon well understood by all. In this situation linking of natural beneficiaries to prior planning to for benefit of certain companies and individuals is simply ‘dirty politics’.

Overall, if we look at the gains to the majority of honest law abiding citizens of India because of NoteBandi, we all can agree that it will:

Curb black money (if not 100% then at least 50-75%)

Curb corruption (less black money would lead to less corruption)

Curb inflation (caused due to fake currency)

Curb terrorism (by breaking its backbone, fake currency, and illegal income generation)

Curb Naxalite terrorism (by reduction of fake currency used to empower them)

Increase GDP (by merging parallel economy in the main economy)

Increase tax revenues (by inviting more tax returns than before and fines paid by defaulters)

Apart from the above points, this will also create a balance in the society and lead to the betterment of the lower middle, middle and upper middle class. As in last two decades due to increasing in education, opportunities, liberalization, cash flow, valuation of property, salary & business earnings, fake currency etc., black money has grown to the extent that it is close to the main national economy and is known as the parallel economy. This parallel economy has widened the gaps in the above 3 classes of Indian society. Curbing black money certainly would shorten these gaps and make a safe, homogenous and progressive society which has less grudges and lesser crime in turn.

Talking about our industry (IT industry), as far as imaging/compatible/refilling/recycling industry is concerned I think it will grow provided we offer better products and better services to the end user. Here ‘better’ means ‘close to OEMs’. May increase the price-range but quality of products and services should really be better. The fact is in spite of our products being so cost effective (50-75% than the price of OEMs) we’ve not been able to capture a share of OEM products.

So far as IT hardware/media/networking industry is concerned, commodity wise there should not be a negative impact as they are NOT purchased as show biz or status symbols. In the initial phase, they may have a negative drop that too in premium or lifestyle range of products but commodity wise not much drop is expected to happen.