The Black Tiger

By Srijan Pal Singh

The Black Tiger is a product of a lucid research into the complicated world of black money— its mechanisms, its movement, and its soft spots. A meditative and well-referenced critique of corruption and its corruptible practices, the book is a study of various countries across time and geography that have fought corruption in their own systems. From the ICAC of Hong Kong to the Clean Governance of Georgia and from the fight against Foreign Parked Black Money by a US court to the truly consequential None of the Above vote of Colombia, Srijan Pal Singh, trusted advisor and a close associate of Dr. Kalam, analyses case after case, putting forth cogent arguments on the many dimensions of corruption and how it can be systematically weeded out from India. At once fascinating, absorbing, and informative, The Black Tiger is a must-read for those who wish to know how India can become a superpower in the next few years, as envisioned by Dr. APJ Abdul Kalam.

• Language: English
• Publisher: Fingerprint Publishing
• Release date: Aug 8, 2017
• ISBN: 9789386538116

Book preview

CHAPTER ZERO

THE NOTES ARE WORTH PAPER

Every day as the ageing sun sets in western skies, amidst the cacophony of hurrying birds returning to their nests, the sound of azaan, a call to prayer, breaks out on the loudspeaker in the mosque near my home. As the namaz gets over in less than five minutes, within seconds the temple bells begin ringing. They pick up tempo, synchronizing with each other’s melody as the last Hanuman aarti commences in the temple, four buildings ahead of the mosque. The temple waits till the namaz is over before it starts its ritual. The aarti goes on for some good ten minutes, with conch shell blowing and chants to the holy God.

This is Lucknow.

I was born here and for the first twenty years of my life lived in this locality, with the mosque and the temple taking turns to herald the almighty. For these two decades, I never found the aarti overlapping the azaan. People co-existed and so did their gods. It was here I saw through the difficult phase of 1992, when there were glaring clashes between the two communities over the fallen Babri Masjid, and later in 2002, when the Godhra Riots broke out. But the azaan and aarti in my place were always at peace and always in sequence.

Lucknow is on the banks of the river Gomti and in the cradle of the Awadhi culture with its three pillars—music, food, and political discussions. After all, Lucknow is the capital of the largest state of the nation—Uttar Pradesh, which has given nine of India’s fourteen prime ministers. As a millennial generation, born in the 1980s, I witnessed a typical family—a father serving full-time in government services and a mother balancing herself between the household and her quest for extra income for her children. In the early 1990s, as the freshly released economy grew at odd angles and directions, the seeds of new dilemma germinated. It came to between the old school of morality and the unhindered chase of the fresh wealth by means which were so far considered immoral. Corruption in middle level government gained momentum, and few in the government remained in the old school of living by the ageing, and often crumbling, code of honesty.

My father stuck to the latter principle.

It meant we lived in a small house and went to school on cycle rickshaws. If for some reason the rickshaw was not present, we would walk back home. But it gave him a sense of pride, like one gets in owning a priceless antique. Only occasionally would this pride be shaken, when a distant relative would visit our house and on seeing the modest furnishings would comment, Sir, your house doesn’t look like it belongs to a senior government servant at all. As he was not considered a ‘cash cow’, he spent a career in fringe roles—doing his best to transform them to the best of his ideas and abilities. This is how I grew up.

When father retired some ten years ago, he had saved barely enough to buy his first owned house, where we moved in. My mother owned minimal jewellery. Like all such honest and modest people he found solace in the fact that his children were looking at a promising career through their academic rigour. ‘Only honest people can nurture talented, hardworking children’ was his motto.

But as he retired and looked back at his career, comparing it against many of his colleagues’, there was an unsettling resentment at how blatant corruption was almost never punished and in fact frequently rewarded.

‘In my pride for being honest, did I miss the opportunity to have a better quality of life?’ is an oft-asked question by these few retirees of the new millennium.

You always have that one childhood best friend who got lost in time and distance while growing up, only to be reunited a decade or so later when fate threw you both at the same place and at the same time. I had one such friend too.

Not far from my childhood home lived Arjun. We were born in the same year, and in fact only two weeks separated us in birth. We went to different schools, but partly due to being introvert children with few friends in school and partly due to the sheer proximity of our age and houses, we managed to become decent friends. In fact, Arjun and I almost grew up going through same educational paths, engineering followed by MBA, though in different cities. After about half a decade of friendship, we were, hence, separated by distances.

It was only recently in mid-2016 that we were reunited in Lucknow—where Arjun now works as a manager in a renowned private bank, not far from my new home. Arjun complained about how corrupt politicians and bureaucrats were plundering the nation and its economy. He said, While we private sector employees are working hard and honest, paying dues in time and serving the people through our work and the poor through our taxes, the rich and the mighty take every opportunity to swindle the nation. In uncharacteristic anger, he raged, I wish I would have a chance to change this system.

It was impressive to witness the resolution of the young man to make a better society and nation. What Arjun was saying is reflected in many young hearts of India working diligently in banks, call centers, the IT sector, and companies all over India’s major cities.

Roughly three hundred kilometres east of Lucknow is the district of Kushinagar. The area is of major significance as Gautam Buddha attained nirvana (passed away) there. Living in the Kaptanganj area of this district was sixty-year-old Teertha.

She was barely educated and of little means. Like most Indian women classified in the ‘struggling’ socio-economic ladder, she was better known by not her name but the profession. No, not her profession, but the profession of her husband who was a washerman, or dhobi.

So Teertha lived her life being called the dhobin (washerwoman). She helped her husband, Ram Prasad, run a small, very meagre business of washing clothes of nearby residents. They barely managed to meet the basic requirements of the family. In depravity decades faded away.

Most rural Indian women have a remarkable financial habit—that of saving. In my travels across India’s hinterlands, I have always found that even in the poorest of families the women are the primary insurers of the family. They create a personal home-stored saving from the daily expenses their husbands give them to run the family. It may even be a very paltry sum, running as low as Rs. 50 a month.

In most cases the wife does not tell her husband about this saving. In vast parts of Northern India, such a saving is inventively called khurchan—a union of words kharcha (expense) and khurachna (scratching).

Often khurchan is stored as buried deep in grain boxes, in a secret compartment of their small make-up boxes, inside pillow covers, or even dug into the mud in those numerous kachcha houses. This little recurring deposit accumulates over time and is used in those troubled times, usually when needed for their children. It is a mother’s love expressed in financial language. It is their instrument to occasionally oscillate between playing a Santa Claus in good times and Saviour in bad ones to their children.

Teertha was no different from these millions of Indian women—saving coin by coin from her husband’s income. When November 2016 arrived, she pulled out all the small coins and notes she had with her. They were quite a lot and difficult to manage now. So she took the help of a local schoolboy to count. All put together they were worth a little over Rs. 2,000. Teertha was overjoyed. She made the boy count again, and when the results tallied she gave him ten rupees and sat down with her saving of over a couple of years. She then carefully put them all together in a cloth bag and went to the local general merchant. She exchanged her cumbersome savings for two crisp Rs.1000 notes. She was proud of the smartness of her exchange. Those two large note, bearing the smiling face of Gandhiji in a tone of amber-red, were the mark of her hard work, sacrifice, and pain.

8 November 2016.

On a seemingly dull and relatively warm evening in the waxing days of winters in Northern India, the prime minister of India, Narendra Modi, made an unannounced and unexpected television broadcast to the nation. What began as a speech at precisely 8 pm, escorted by usual words of euphoria, digressed suddenly into a thunderbolt declaration.

The 500 and 1,000 rupee notes hoarded by anti-national and anti-social elements will become just worthless pieces of paper, declared the prime minister, pausing briefly as if to give his television viewers time to gasp and absorb the enormity of the moment. He then went about elaborating how this was needed to clear black money and fake currency, stashed as cash in vaults, and how the citizens can still easily exchange their old notes in banks and post offices or deposit them in their accounts.

Then the deadline was set as 31 December. India would complete demonetization by end of the year 2016.

Many wondered and hoped if India had made another tryst with destiny at the stroke of midnight, almost seven decades after Jawaharlal Nehru’s famous speech on 14 August 1947, at the dawn of independence. Few understood how this would work. In November 2016, the total currency in circulation across the nation was Rs. 17.97 lakh crore (trillion), of which 86%—Rs. 15.45 lakh crore—was in the scrapped 500 and 1000 rupee notes. Effectively, the move left the third largest economy of the world, so far running mostly in cash, to operate with only one out of every seven old currency notes in value.

What was alarming was the fact that the international trends went against the move. With this move India joined other such attempts made in Soviet Union, Zimbabwe, Nigeria, Ghana, North Korea, and Myanmar. All these attempts had ended in failures and crippled the economy, and India’s case was even more precarious as the demonetized notes carried much higher share in the overall economy.

Demonetization is not new to India: When the government decided to demonetize 500/1000 rupee notes it was not without precedence. In the past 70 years, this has happened twice (1946 and 1978)—on both occassions with the intention to curb black money. The 1946 news is shown above and 1978 news is below.

Source: The Indian Express

On the brighter side, India seemed better prepared for handling such a situation with its wide and far reaching network of banks, post offices, and mobile phones. In 2013, there were over 100,000 commercial bank branches in India. Almost three-fourth of them were located in rural or semiurban areas. Similarly, the Indian Postal Service had about 155,000 post offices, of which almost 140,000 (90%) were in rural areas and about 15,000 (10%) were in urban areas.

A tsunami of opposing sentiments of optimism, panic, chaos, and confusion would follow for the next few weeks. The nation was in a spin and no one could tell where we would land when the dust settled.

My father was glued to the television that evening, running into late night, and then the following days. He was tracing every single discussion, argument, and debate. For him, the declaration came as a redemption and a sort of vindication from the jibes of having been left behind in honesty. For him, as a retired official living in modest savings, dignity of integrity had been restored. He watched the news channel with new-found hope and admiration.

DEMONETIZATION IN THE PAST

1. Soviet Union: Under Mikhail Gorbachev in January 1991, the government withdrew large ruble bills from circulation in a move to take on the black economy. The government declared the 50- and 100- ruble notes being invalidated amounted to about one-third of the money in circulation. The result was a failure of epic proportions and inflation grew out of control, ultimately leading to the collapse and disintegration of the Soviet Union itself.

2. Zimbabwe used to have $100,000,000,000,000 note. That is one hundred trillion Zimbabwean dollars on a single note! The economy went for a toss when President Robert Mugabe decided to ban the ridiculous note. After demonetisation, the value of the note dropped to $0.5 dollar. It was also put up on eBay.

3. North Korea: In 2010, Dictator Kim-Jong ll introduced an ‘ingenious’ reform that knocked off two zeros from the face value of the old currency in order to banish black market. The result was total economic collapse and induced famine in the countryside.

4. Ghana: The country in 1982 got rid of its 50 cedi note to crack down on tax evasion, address corruption, and mop up excess cash. The move damaged confidence in the banking system as people turned to foreign currency or physical assets. The black market for currency flourished. As rural dwellers had to walk hours to nearest banks to exchange their money, and after the deadline passed, there were volumes of notes abandoned as worthless.

Reeling under inflation: Zimbabwe had a 100 trillion dollar note which was demonetized post 2016. Interestingly, in 2016 it could fetch only about Rs. 16. Ironically, it was worth more than that on eBay sold as a novelty.

Table 1: No. of branches of Scheduled Commercial Banks as on 31 March 2013¹

His feelings were shared by many similar retirees in his group of friends. They would discuss which of the government officials or politicians or real estate businessmen was now running pillar to post, on the verge of losing all his ill-gotten cash wealth. A story emerged how a prominent politician of the state has a cellar full of cash notes, which were fumigated with insecticide to save them from termites. "Ab kya karenge, kaise bachenge?" (What will they do now, how will they save themselves?), they would discuss and smile at each other in pride.

For the first couple of weeks my father was on cloud nine. He was beaming with hope and happiness was flowing out of him.

The next day after the historic announcement of demonetization there was a mad frenzy inside banks and long lines outside them. Nearly all banks were poorly supplied with the new notes and were ill-equipped to handle such exchanges by the masses. On the other hand, the citizens were in total panic mode to get rid of their old currency.

Teertha, the dhobin, was one of them. She had just got two crisp notes of Rs. 1000. Some villagers talking at a tea stall told her that the old notes were useless now. First she thought it was a joke, but when several people said the same thing she developed doubt. She showed her two notes to the men sitting around for chai, and they told her that the notes were ‘worth scrap’ and that she should immediately go to the bank and get them exchanged. They warned her, there will be a lot of people there and new notes are limited. Make it quick.

She left all her work and ran to the nearest bank, dearly holding onto her two notes. They meant the world to her and she could not believe that her yearlong saving, ‘khurchan’, would turn to dust. But she had hope from the bank. After all, that is what the men at the tea stall had told her.

Within minutes she reached the bank. She was profusely sweating and her breathing was laboured. She climbed the short flight of stairs to reach the