Gangu Kundaikar is a small-framed, sari-clad woman who rises at 3 a.m. every day, wraps a cloth around her waist so fish do not soil her sari, and takes a rented vehicle to the Malim jetty in Panaji, North Goa, 8 km from her village in one of Indias most prosperous and literate states.
Kundaikar, 50, brings her day’s supply of fish back home to her village, Chimbel, to sell. Kundaikar, who studied up to class 10, has no bank account and a phone without an Internet connection. She is the only earner in her family of three, which includes her ageing mother and unemployed son.
Kundaikar bought fish worth Rs 3,000 to Rs 4,000 every day and kept the unsold catch in her refrigerator – her only asset. She worked through most of the day and barely made enough to keep her family fed.
That was before midnight on November 8, 2016, when Prime Minister Narendra Modi’s government scrapped 86 per cent of India’s bank notes, by value. Since then, Kundaikar has struggled to balance her family’s budget: Demand for fish has fallen and sales have dropped by 30 per cent. “We are poor, hard-working people,” she told IndiaSpend. “Because of this move by the government, it has become hard for us.”
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After China, India is the world’s second-largest producer of fish, but it is a perishable commodity, and less than 19 per cent of fishing centres nationwide have infrastructure that allows fish to be processed or stored: Less than 23 per cent of fishing villages have Internet access, and the fishing economy depends on cash. Profit margins vary according to the species sold, varying from 3.5 per cent (medium-priced fish) to about 10 per cent (high-priced fish) to 20 per cent (low-priced fish), according to a 2012 research paper.
So merchant charges by banks – of 2-2.5 per cent (on credit cards), 0.75-1 per cent (on debit cards) – and even the 1 per cent fee charged by Paytm, a digital wallet – is largely unaffordable, even if fishing villages had good internet access, which they do usually do not.
With notebandi – as the scrapping of Rs 500 and Rs 1,000 notes is colloquially called – stories like Kundaikar’s have become common in fishing communities nationwide. Distress sales, market closures and anchoring of fishing fleets have been reported from West Bengal, Andhra Pradesh, Tamil Nadu, and Kerala. A particular hammer blow appears to have been dealt by the new Rs 2,000 note because there is no change to return.
The crisis of 14.5 million Indians – more than the population of Greece or Portugal – dependent on fishing has crippled an industry that generates almost 1.1 per cent to India’s gross domestic product (GDP). A quarter of these people work along 8,118 km of India’s coastline and 10 million along 197,024 km of inland waterways.
Most of these 14.5 million are part of India’s informal sector, unorganised workers, who constitute 82 per cent of India’s 500-million-strong workforce – more than the combined populations of the USA, Germany and South Africa – and generate half of national GDP. Their world, as we found, changed almost overnight.
Ground reality: Over 50 per cent loss in business, anger at government
Of the 20 fish sellers that IndiaSpend surveyed at a government-run market in Margao, south Goa, more than 80 per cent reported buying less fish from wholesalers because demand was low, while 75 per cent reported income-losses of half or more over the past month.
Our survey also showed that 30 per cent of women did not have a bank account and that 55 per cent did not use phones. Of the ones that did, only 33 per cent had internet on their phone, which they did not use for banking.
Small-scale fish retailers earn between Rs 3,000 and Rs 4,000 every day, IndiaSpend found. If they were to use Paytm for transactions, they would be paying 1 per cent charge to withdraw their money, which is Rs 30-40. For a daily profit of Rs 350-400, they said, this is unaffordable.
Cashless transactions are not an immediate option, so the losses will continue. In any case, most have no internet on their phone and hardly use their bank accounts, said Shashikala Govekar, president of the Fish Vendors Association at the Mapusa market.
We found a cascading effect of such losses. Before November 8, 2016, fish sellers got Rs 280 to Rs 300 per kg of mackerel (bangda), which is now down by about 35 per cent to Rs 180 to Rs 200 per kg, according to members of the All Goa Wholesale Fish Market Association. The Margao Wholesale market is the only wholesale market in Goa where catch from the neighbouring states of Maharashtra and Karnataka is also sold. Vehicles carrying fish from outside the state have fallen by a third.
Unless frozen, fresh fish must be thrown away, if not sold within two days: 67 per cent of fish consumed in India is fresh; no more than 23 per cent is processed (dried, frozen or canned).
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Neither fish markets nor landing centres (harbours where fishermen land their craft) have cold storages. Post-harvest fishing losses due to lack of infrastructure (for landing and berthing vessels) and domestic marketing are estimated to be as high as 20 per cent, according to a 2011 report of the erstwhile Planning Commission. These losses are exacerbated by the current market slump.
Can Goa really go cashless? Even the Chief Minister does not think so
On November 25, 2016, 16 days after the demonetisation announcement, the Indian Express reported Defence Minister and erstwhile Goa Chief Minister (CM) Manohar Parrikar saying that Goa would become India’s first cashless state by December 30, 2016.
“Goans are using cards (ATM/credit) in a big way,” Parrikar was quoted as saying at a public meeting near Panjim. “Goa will soon be the first state with cashless society fulfilling a dream of the Prime Minister.”
On December 7, 2016, after his party and the opposition reflected the resentment across Goa, CM Laxmikant Parsekar said that there would be no deadline for Goa to go cashless. “There cannot be a deadline to go cashless,” said Parsekar. “I have always said that it is not cashless, but could be less cash to start with. Goa can do it.”
A major reason that India is unprepared for a cashless economy is a lack of connectivity. At least 73 per cent of Indians (912 million people) do not have access to the internet, IndiaSpend reported on December 3, 2016.
Within 3,237 marine fishing villages in nine of India’s coastal states, 91 per cent villages had mobile phone coverage, but barely 23 per cent had access to the internet.