The Italian Kautalya, Niccolo Machiavelli, is supposed to have said that ‘Politics is the art of deception’ (or maybe it was the Indian Machiavelli, Kautilya, himself). Whoever it was, he has an able student in the Indian prime minister (PM) – a prestidigitator par excellence. Now, a good prestidigitator is one who will distract you with some dazzling spectacle performed by one hand, while the real trickery happens quietly with the other, which you don’t see. But a great prestidigitator is one who will hide the trickery in the spectacle itself – so you can see it happening, and still not see how thoroughly you are being fooled – or even that you are being fooled at all.
We are today witnessing one of the greatest political prestidigitations in the history of India – perhaps of the world. Over the last few months, the country has been rocked by a series of politico-economic earthquakes, starting with the infamous demonetization move. This was followed up with the dramatic acceleration in the enforcement of the Aadhar-UID scheme, culminating in the directive to link Aadhar to subsidies on the one hand, and to the filing of income tax on the other. And then, even before we could blink the spots out of our eyes from that spectacle, along came GST, and the furore over it. As the dust from these earthquakes slowly settles, when we look back at the destruction, certain patterns are slowly becoming discernible. They are as ominous as the shadow of a mushroom cloud.
In this piece, I aim to trace out those patterns. It is a somewhat lengthy piece, because sometimes, in order to see what lies beneath, or behind, or beyond that which is obvious, it is necessary to look elsewhere – to trace the signs of that which is hidden through its reflection in a series of metaphorical mirrors placed around it – rather like Medusa’s head, and in this instance, far more deadly. I ask the reader’s patience and indulgence; read through to the end, and hopefully, the patterns I trace will become fully, and awfully, comprehensible.
The first of these is evidence of the calibrated sequentiality with which each of these events unfolded. At first smell, they appear unrelated; but the stench of something rotting in the state of saffron grows strong soon enough, when we look at them closely, especially in terms of their effects and consequences. Let’s take demonetization, where it all started: it was unrolled with much trumpet-blowing as the mother of all surgical strikes on black-money and corruption. Within a month the tune had changed completely: all references to black money vanished, and the entire exercise was being referred to solely as a drive towards a cashless economy. To this end, a new set of directives were issued, that tightened the flow of cash transactions – e.g., limiting the number of free cash withdrawals and deposits, placing a ceiling of Rs 2 lakhs on cash transactions, etc. Meanwhile, the baffling appearance of the Rs 2000 note, at a time when the claim was that high-denomination notes were being pulled out of circulation because they facilitated black money, was repeatedly brushed aside with non-sequiturs – till it came to light that the new notes had been selectively and secretly released in large quantities well before their official release. As of December 2016, a total of Rs 242 crores in new currency had been seized from various parts of the country – and since this is only the amount that has actually come to light, one can safely say that it is no more than the tip of a very large iceberg of new currency that was pre-released, to facilitate the conversion from old to new, for those bhakts who had stashed away more than they should have. And finally, when it became clear that only about Rs 75,000 crores would not return – as opposed to the government’s anticipated figure of Rs 3 lakh crores – it cast an even longer shadow of doubt on the efficacy of demonetization to meet its (first) touted objective, of explosing black money.
So what was achieved? A large step towards the cashless economy – in fact, the single biggest and most coercive move towards a cashless economy – disguised as an attack on black-money, but no less coercive for that. At the time, Mukesh Ambani – a main character in our narrative, as we will see – set a very large cat among the pigeons when he praised demonetization on the grounds that, with demonetization, ‘India has taken a big leap forward from a predominantly cash economy to a digitally enabled optimal cash economy. It has brought unproductive money into productive use.’ This provoked much speculation – that this was a move to bring cash into the cash-strapped banks, immiserated by bad loans to big corporate players, so that those very corporate players (perhaps like Ambani himself) could avail of it ‘productively’; or that it was mooted by foreign financial interests, seeking to enter the financial sector in India, and make a killing in the massive market for retail banking and electronic payments. Disgruntled sections of the middle class complained, through various Whatsapp messages, that this was a way for the financial corporations to either steal their money (yet again), or make money off the hapless customer by charging a commission on every single transaction – and all this may well have been true, perhaps remains so. But this was still not the real trick, although it too – like all good prestidigitation – was hidden in plain sight, and was revealed only after the whole ‘I shall uncover black-money’ spectacle was revealed to be a no-show. No, like a Chinese puzzle box, with layer within layer, this layer too was still part of the distraction. The real trick, in fact, was not out yet.
At the same time that demonetization happened, in an apparently unrelated way, our hero Mukesh Ambani’s own Reliance Infocomm Ltd (RIL) had brought out its Aadhar-linked Jio connection plan, again with much fanfare. It caused a minor ‘earthquake’ by offering free calls and data, albeit for a limited period, leading to a frenzied rush to get the connection – after all, who can say ‘no’ to freebies? In the space of 6 short months, by March 2017, Jio had registered more than 100 million users – a little less than a tenth of the population of the country. More significantly, since the Jio plan’s USP is free data, this figure accounts for almost a quarter of all internet users – approximately 450 million – and about one third of all smartphone users – approximately 300 million – in the country. The freebies raised few questions, and even competitors like Bharti Airtel only raised complaints about ‘predatory’ marketing and unfair pricing practices. No one wondered why Reliance would invest a whopping Rs 150,000 crores – and that is just the initial investment – for this scheme, just to give it away free. Nobody, not even shareholders, raised questions when the company officially reported a net loss of Rs 22.5 crores for the half-year till March 2017, nor with the news that it will report a further loss of a massive Rs 19,600 crores in 2017-18, or in fact that it will begin to record profits only five years from now. Even accounting for ‘predatory’ marketing tactics, in anticipation of future returns, this is a monumental gamble – unless there is a hidden card, a dead certitude that the investment will pay off. So, what gives?
In May 2016, well before the Jio plan was launched, ‘Reliance Infocomm Ltd’s…digital wallet app JioMoney made a quiet debut on Google Play Store’, with the specific intention of enabling ‘cashless payments through smartphones’. In March 2017, it was reported that ‘with its Lyf brand [of smartphones] Reliance Digital was the fifth-biggest smartphone vendor of India in Q3 2016’ – i.e., a little before the demonetization move was being initiated – and that Reliance Jio was ‘collaborating with Google to develop an affordable Android-based 4G VoLTE smartphone that will work exclusively on the Jio network.’ This ‘affordable smartphone’ – estimated to be anywhere between Rs 999 and Rs 2000 – is expected to be out by the end of this year. I’ll come back to the significance of that date in a bit (for that is in fact the key to the final revelation from the master prestidigitator). For now, let’s just draw out the patterns that are emerging: RIL brings out its cashless payment app just months before the single biggest and most coercive drive towards cashless payment happens, in the garb of demonetization, and follows it up with free data – not just free voice calls, but free data, which is essential for cashless payment to happen – in its Jio plan, at monumental costs; and then backs it up still further with massive sales of its smartphones at the exact same time – a program it seeks to intensify, in its collaboration with Google. Coincidence? Even if we didn’t know that the head of RIL enjoys a very close personal relationship with the prime minister, it would be difficult to dismiss this as coincidence. The fact that he does; and that his first response – that ‘unproductive’ money was now available for ‘productive’ use – was made in the context of the fact that, because of Jio, RIL is in debt to the tune of Rs 47,000 crores; indicate that these developments were far from coincidental. Add to that the little detail that the RBI governor, Urjit Patel, the PM’s demolition man for the entire demonetization process, was once President, Business Development, in Mukesh Ambani’s Reliance Industries (and what a way to develop his business!) and any remaining doubts will vanish.
But this is not yet our “Aha!” moment. If we now believe that this entire process was therefore undertaken simply to benefit Mukesh Ambani and RIL, we would again be guilty of being taken in by the spectacle: the real trick still remains concealed. It is certainly true that RIL was a central player in this game, but we must recall the enormous gamble it apparently took; and even with demonetization coercing its clients into using its cashless transaction app, JioMoney, and even with its subscriber base constituting a third of all smartphone users in the country, it was, and remains, a long shot to gamble on, given that, by its own estimates, it would break into profit only after five years. That is a long period of uncertainty in the life of a business. Furthermore, even if, hypothetically, it stands to benefit enormously after five years, the fact is that, so do all the other telecom corporates playing the cashless transaction market – and that too, probably much earlier, since they don’t have the burden of the massive investments made by RIL. So – as we noted earlier – unless some other unknown factor is at play here, that has erased the uncertainties for RIL, and guaranteed its stakes, the role of RIL remains somewhat baffling.
Another, equally pertinent question arises in this context: if this exercise was undertaken to benefit RIL, and the telecom sector at large, what was the quid pro quo? How did this current regime gain from all this? Money in the bank? Perhaps, to some extent; but since all this money is now ‘white’, it has very specific and limited utility, and could hardly have been the driving motive behind demonetization. A reputation for transparency and honesty? Possibly – although, again, this would seem a somewhat excessive way to achieve that – and in light of all that we have noted above, rather contradictory too. It’s time to look at the third ‘earthquake’ that happened, to answer these questions.
This one came a few months later, although it too, like the others above, had been carefully orchestrated for several months before, its base built even over several years before. In April 2016, the UIDAI announced that it had generated more than a billion Aadhar numbers, covering 93% of all adults, 67% of children in the age 5-18 age group, and 20% of children less than 5 years old. By March 2017, about one year later, this figure was up to 1.12 billion – an addition of approximately 120 million, in the course of one year – perhaps the biggest jump in Aadhar registrations ever. Then, through two directives – one, a circular issued on the 2nd of November 2016, bang in the middle of demonetization, and the second, the passage of the Finance Bill on the 22nd of March 2017 – the government effectively made Aadhar mandatory for any and every financial transaction in the country, for filing of all tax returns, as well as for availing various services, including pensions, the largesse of the Public Distribution System, employment under the various employment schemes, etc. Among these latter, of particular significance for us is the fact that banks and the telecom corporations have rushed to make Aadhar mandatory. In all of these, Aadhar was and is being encouraged to be treated as ‘the primary identifier’ of the citizen. This key phrase has been the cause of some confusion, because, on the one hand the government has strenuously sought to maintain that Aadhar will not replace any other identification and citizenship documents, such as the passport, ration card, voter ID, etc; on the other, when the Finance Bill was passed in March, the Finance Minister indicated the possibility that Aadhar could, in fact, replace other documents like the voter ID, Pan card, etc.
Almost at the same time, the GST was declared as the new transformative event in the economy of the country. For a tax-reform that the PM repeatedly spins as the ‘Good and Simple Tax’, the GST seems to have baffled even the best financial and accounting minds, but that is not what I am concerned with – it is, to my mind, just more spectacle and distraction. What is pertinent for me is that the GST, like other financial transactions, will have to be complied with electronically, preferably using software designed specifically for that purpose. Further, the government plans to link GST with the Pan card – and since that has to be linked to the Aadhar, the GST is effectively linked to Aadhar too. So now, through linking income tax and the GST to the Aadhar, every individual in every sector of production and income, and his/her earnings and wages, will be directly tracked by the government.
What does all this mean? If we step back from the dots we have been connecting, the picture that emerges is not a happy one. In order to explicate it, let’s start with first principles – because, clearly, this master prestidigitator has, with frightening thoroughness:
- Every individual is a seller and a buyer. That is, every individual who earns an income sells his/her labour, either indirectly, through the production of goods that are then sold, or directly, in the form of services. The same individual also has to buy goods and services sold by others, for his/her needs (and that of their families).
- The productions and consumptions of this individual, recorded through every transaction they make, are now open to scrutiny, with the records themselves now the property of the state – which is why it was so easy for the Attorney General, Mukul Rohtagi, to argue boldly that “The arguments on so-called privacy and bodily intrusion is bogus,” he said, adding, “one cannot have an absolute right over his or her body”.
- Further, in the present scenario, banks and other financial institutions will mediate all transactions, since all (or at least, the vast majority of) transactions have to be electronic. And since free withdrawals and deposits of cash are restricted, access to one’s own money in the form of cash is also controlled by the same institutions (no doubt Mukul Rohtagi will argue that one cannot have an absolute right over his or her money – which in any case is the logical corollary: after all, if you don’t have full rights over your body, how can you claim full rights over the earnings and spendings of your body?). Earlier you owned your money, and you had control of it; now, even if you have some claim to owning it, you have little or no control over how to use it.
- In other words, the simple individual-to-individual transactions that were common till now, will not only be difficult, they will be illegal: the state, or its financial representative in the form of the financial institution that mediates your transactions, must be a necessary third party that will mediate and record all transactions, and charge a fee for doing so.
- Every individual is also a social being – meaning that s/he is always already in a series of individual-to-individual relations. In today’s world, much of this social interaction happens online, usually through the very same instrument by which the said individual conducts cashless transactions, and often with those very other individuals. In other words, in this format of the digital economy, a payment made between a husband and wife, or a girl and her boyfriend, or a parent and child – or even in relation to them – is monitored by the telecom agent, as well as subject to the all-seeing gaze of Aadhar.
To sum up this miserable picture: between the telecom companies, especially RIL (which is not only aiming for a monopoly, but, through its alliance with Google, will become a formidable instrument of mass espionage on the unwary citizenry), the financial institutions and the state in the form of the UIDAI, the citizen – every citizen – can be subjected to simple pressures, starting with disconnection of the data connection; escalating to summons to explain various transactions, with possibly even threats to reveal his/her private transactions; and culminating the erasure of his/her Aadhar, and all that that entails.
Suddenly, the corporatized state and its statutorily empowered corporate agents are not out there anymore, they are here, between us, deep in our lives, intimate as our shadows. This is not an invasion of privacy. It is an erasure of privacy.
But the story doesn’t end here, the trick is still not complete. In fact, the worst is probably yet to come. Once we realize the full implications of this pattern, the question that must arise is, Why? At first glance, the answer seems obvious – it is about control. But control to what end? Here, we must recall a very innocuous-seeming statement, made almost in passing, by the Finance Minister: that Aadhar can replace the Voter ID. Now imagine an election in which every voter’s vote is individually knowable. Imagine this being justified in the name of transparency – for after all, if the voter’s body is not his/hers, why should his/her vote be sacrosanct? Then imagine the susceptibility of dissenters and even fence-sitters to pressure to vote a particular way, through this enormous, totalitarian apparatus of control that is being put in place in the name of fighting corruption, and that old stinking chestnut, national security. And now imagine the India that will emerge from that election.
It is the shadow of this imagination that is now discernible in the patterns we have drawn here. This is what we are all being fooled for: for the creation of an India that is unrecognizable, through the most devious and insidious of means possible. This is the final trick that the master prestidigitator is leading up to – hidden in plain sight, in all this dust and noise, discernible as no more than a shadow. And it is the shadow of a mushroom cloud rising up out of the ashes of this nation, in the not too distant future.
[This article was first published on Countercurrents.]
 See http://datanewsroom.com/a-total-of-rs-twenty-two-crore-ninety-lakh-and-fourty-eight-thousand-has-been-seized-in-new-currency-notes-till-december-7th/, for data on these.
 See http://www.hindustantimes.com/india-news/cash-crunch-rs-242-crore-in-new-currency-seized-after-demonetisation/story-ZFidspQbfQqcIGbQPcgtPJ.html
 See http://indianexpress.com/article/business/economy/demonetisation-black-money-cash-crunch-rs-14-lakh-crore-in-old-notes-are-back-only-rs-75000-crore-out-rbi4465542/
 See http://english.manoramaonline.com/business/news/mukesh-ambani-showers-praises-on-pm-modi-demonetization.html
 See http://www.livemint.com/Industry/QWzIOYEsfQJknXhC3HiuVI/Number-of-Internet-users-in-India-could-cross-450-million-by.html
 See http://tech.firstpost.com/news-analysis/number-of-smartphone-users-crosses-300-million-in-india-as-shipments-grew-18-percent-359075.html
 See http://www.livemint.com/Companies/ncT04NLRTtEMDEHAWdMPGN/Reliance-Jio-initial-investment-at-Rs150000-crore-Mukesh-A.html
 See http://www.livemint.com/Industry/wVDwB0wKqaXxqVFqEWp4kK/Reliance-Jio-crosses-108-million-subscribers-claims-to-be-l.html
 See http://telecom.economictimes.indiatimes.com/news/reliance-jio-will-register-a-loss-of-rs-19600-crore-in-2017-18-iifl/57991291
 See http://www.gadgetsnow.com/tech-news/Reliance-Jio-Money-Wallet-silently-launched-on-Google-Play-Store/articleshow/52207235.cms
 See http://gadgets.ndtv.com/mobiles/news/reliance-jio-google-working-on-low-cost-4g-volte-android-smartphone-report-1669343
 See http://www.business-standard.com/article/economy-policy/aadhaar-to-become-only-id-proof-may-replace-pan-voter-id-too-117032201349_1.html
 See http://www.financialexpress.com/economy/gst-to-be-linked-with-pan-card-heres-how-government-plans-to-prevent-tax-evasion/744343/
 See http://www.firstpost.com/india/aadhaar-mandatory-citizens-dont-have-absolute-right-on-their-body-privacy-argument-bogus-govt-tells-sc-3420398.html