Bribery is a big way in India that generates black money. In schools, colleges, hospitals, pension offices, recruitment boards,
electricity department, water department everywhere bribery is rampant. It is common belief these days that government job
interviews canít be cleared until bribe is paid. A Transparency international study in 2005 showed that 62% Indians had paid bribe
in their lives had paid bribes to get their tasks done in government offices. The same study in 2008 showed the number of bribe payer
Indians to be 40%. A 2017 survey shows that seven out of 10 persons, who had to deal with public offices in India, had paid a bribe.
Nearly 40% of the survey population believed that corruption has increased in last 12 months. A whopping 73 % of those who had paid a
bribe belonged to poor sections.
With demonetization, the cash stashed as a result of at least large bribes would be rendered useless and RBI would be
extinguished of its liabilities. This measure would bring down the level of bribes in public offices in the future.
Indian law has provisions to punish bribe takers in public offices but India also have a sprawling bureaucracy and a weak
judiciary making it possible for dishonest bribe seekers get away with them.
Modi government has stressed on less cash economy and made systematic changes to encourage people to use e-wallets and
e-transactions. In a less cash economy the bundles of black money cannot be stacked and taking bribes with an e-transaction
is suicidal as it leaves a money trail and tax authorities can nab you anytime following the transaction route and cause.
Therefore, cash is not available to offer bribes using black money to corrupt bureaucrats and they do not dare to take bribes
using electronic channels due to fear of being tracked by audit and tax authorities.
Although demonetization was targeted to give a blow to corrupt people that have huge amounts of black money, the common man
had to face great difficulties due to it. Only about 32% Indians have access to banks and there is just one bank on every
9500 Indians. The common people had to queue outside banks and ATMís for hours. Often the ATMís and banks would run out of
cash leaving people more and more frustrated. The government had to face severe criticism from opposition parties and media
for poor planning and implementation that wiped out 86% of the total volume of Indian currency. The people without bank accounts
were the most severely affected. It is true that people were losing patience for the inconveniences faced yet most of them supported
the prime minister for his far sighted intentions to fight black and counterfeit money.