Demonetisation And Terrorism


An argument which has been put forward in the recent ‘Demonetisation’ issue is its relationship with Terrorism. It has been pointed out that ‘funds’ either from outside or otherwise find their way into the terrorist groups. Fake currency or notes in denominations of Rs. 500 and 1,000 sustain and fund the terrorist activities. Hence the belief expressed is that Demonetisation will hit the backbone of terrorism.

Though it has not defined terrorism, it can be assumed that it refers to Kashmiri militancy, Maoist insurgency in tribal belts and ethnic unrest in North-east apart from rise of Islamic radical groups.  Establishing a relationship between Demonetisation and Terrorism is too simplistic an argument by the Government. It tends to deny the root causes for emergence of militant activities and unrest among certain sections.

On Kashmir issue, such a relationship tends to deny the political nature of the Kashmiri militancy. It tends to ignore the fact that the Kashmiri militancy continues because of indigenous factors but not because of external factors. It continues due to unrest among Kashmiri with the larger Indian approach of handling Kashmir issue. News that is being circulated in Social media is that incidents of stone pelting have stopped since the announcement of Demonetisation. It assumes that stone pelters involved in such acts after accepting cash worth Rs. 500 funded from Pakistan. However, as reported by Safwat Jargar, the incidents of stone pelting only saw a natural decline starting from 820 in July to 179 in October. This further declined to about 49 incidents till 14h November (15 between 9th and 14th November). As stated by him that such a claim is ‘laughable, stupid and hollow’ for Kashmiri.

On Maoist insurgency, the linkage tends to be ignorant of the fact that it is not the cash in denominations of Rs. 500/1000 but the cashlesness and impoverishment of the poor which sustains the movement. Conditions of mass poverty and inequity create conditions for sustenance of the movement. In the simplistic relationship that is getting established in the name of demonetisation, issues of social and economic inequity, injustice to the tribal groups in the name of industrialisation and takeover of forest lands, large scale displacement of the tribal groups, human rights violations are being denied.

On ethnic unrest in North-east, establishing relationship between Demonetisation and Militancy tends to simplify the complex nature of issues in North-east. The issues in North-east is largely due to a) failure of Indian state to accommodate the ethnic / nationalist aspirations within the framework of Índian Union’; b) continuation of a discriminatory attitude towards North-east; c) failure in creating a fair system which create conditions among ethnic groups not to compete but to share the limited natural resources; d) failure in creating a system for ethnic minorities to feel safer in their geographies with provisions of protecting their cultural identity. These factors seem to be ignored.

The signs of Islamic radicalism may be a worrying sign. However, it cannot be denied that majoritarian extremism in the name of Hindutva may only create more conditions for rise of Islamic radicalism. Moreover, the issue that needs to be addressed is the large scale alienation of Minorities. Protecting and strengthening the secular fabric rather than moving away from it will create this sense of security.

Overall the demonetisation and terrorism argument put forward by the Government is completely unconvincing. Politically, it is reduced to a role played by an external hand. Economically, it is reduced to the contribution of fake currency in sustaining the movement. Socially, it tends to deny the deprivation and social alienation among various sections. Culturally, it tends to ignore the need for religious and ethnic minorities to feel safer.  A simplistic relationship between demonetisation and terrorism only shows the narrow solutions to complex issues.

Jayashubha is a Post Graduate in Organic Chemistry and works as a Teacher

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