Modi’s demonetisation mess has served as inspiration for our lawmakers as the Senate passed a resolution that recommended the government take necessary steps to withdraw high denomination Rs5,000 notes from circulation. The move aims to reduce illicit money flow, encourage the use of bank accounts and reduce the size of the undocumented economy – but will it really accomplish this?

With current levels of inflation, the Rs5000 note has come into heavy use, and withdrawing it disrupts the financial system. The demonetisation policy will easily be circumvented by criminals, and inconvenience the common man. If the Senate really wants to curb corruption, there are many moves it can make to address tax evasion, progressive taxation, offshoring of money etc. If they want more money to be in banks, rather than in wallets, improvements to access to the banking system, and ease of business has to be encouraged. Black investments on gold, in foreign banks, in real estate business, and the share market are not addressed by demonetisation.

The Minister for Law and Justice, Zahid Hamid opposed the resolution vehemently and pointed attention to the fact that there are a total of Rs3.431 trillion notes in circulation and taking away Rs1.020 trillion notes of Rs5,000 denominations from the public would create chaos in the market, not to mention the cost incurred to print them.

The real inconvenience ultimately is for the public and small and medium businesses that are primarily dependent on cash for their day-to-day transactions. The farming community, especially, will suffer due to the currency crunch, affecting their sales and subsequently their produce.

Our lawmakers need to implement better laws to fight financial crime rather than policies transplanted from other countries. There is no attention paid to the Pakistani culture of business, and no real thought given to all the bureaucratic hoops people will have to jump to comply with such an ad-hoc policy. Recalling notes is the easy thing to do if the legislators just want to be seen to be doing something, but to make a tangible difference, it must hold those accountable who are responsible for corruption, no matter their influence.