The government's move to demonetise Rs 500 and Rs 1,000 currency notes will help curb black money in elections and its impact will be visible in the upcoming Assembly polls in five states, say experts, while Opposition leaders called it hasty or questioned its effect.
Former chief election commissioner SY Quraishi said the move will definitely have a positive impact on the election system, but more steps were needed to tackle the problem of black money in polls.
"It will definitely have some impact on the free flow of money in elections but I don't think it will curb the whole menace. We all know that in the Uttar Pradesh and Punjab elections, money plays a big role. There will be some control after the decision," Quraishi told IANS.
However, he added that the political parties would find different routes to convert their unaccounted money into accounted money.
Political parties in Maharashtra, which are in the midst of election campaigns for the upcoming polls to the local bodies, seem to have been hit by the sudden demonetisation as it has affected the disbursal of election funds to party offices.
The move has also put some candidates in tight spot, who were otherwise aiming to lure voters with high-value notes, sources said.
One hundred and ninety-two municipal councils and 20 nagar panchayats are going to polls in the state between 27 November and 8 January.
A senior functionary of a political party requesting anonymity said that demonetisation has affected the disbursal of election funds for party units at the district and local level.
"The move has hit the political parties as well as the candidates, most of whom woo voters with cash," he said.
In New Delhi, the Kranti Maratha Morcha (KMM) has cancelled its rally scheduled on 20 November citing financial crunch, reports The Indian Express.
“The demonetisation has hit our plans to proceed with the rallies in talukas and cities in Maharashtra and outside,” a senior KMM functionary told The Indian Express.
Even BJP itself have been hit by the cash crunch. In Agra, where Prime Minister Narendra Modi is scheduled to hold a rally on 20 November, from tents to chairs and lights, party workers had to arrange almost everything on credit from local traders, reports The Times of India.
According to the report, the time expenditure of would run around Rs 25-30 lakh and "like everyboy else", the organisers have run out of cash.
Jagdeep Chhokar, founder member of Association for Democratic Reforms (ADR), told IANS that the decision will bring about reduction in black money in the country.
"This will absolutely impact the elections, particularly those parties which are gearing up for next year's Assembly elections in five states.
"If political parties have organised their money then it will have no impact on them but those who would not have organised, they may find themselves in trouble. Now they will not be able to organise their unaccounted money. This will obviously impact the elections but will take much more time to completely curb the menace," he added.
Sangeet Kumar Ragi, who teaches at Delhi University's Political Science department, said those who use money power in elections will be severely impacted.
"Candidates who rely on wooing voters by using money will find the going difficult," Ragi said, adding that all political parties will be impacted in some way and those opposing it are doing so for petty politics.
While Information and Broadcasting Minister M Venkaiah Naidu said that the measure will lead to election expenses of candidates coming down and "sincere" politicians would be happy with it, Uttar Pradesh chief minister Akhilesh Yadav linked it to the upcoming Assembly polls and said it was not a permanent solution.
"It is quite possible that decision might have been taken in view of Assembly elections. It seems that the decision has been taken in hurry. They could have discussed it in parliament as the session is likely to begin this month itself," Akhilesh told reporters in Lucknow.
Apart from Uttar Pradesh, assembly polls are expected to be held early next year in Uttarakhand, Punjab, Goa and Manipur.
Union Finance Minister Arun Jaitley, however, said the decision had no connection with elections.
"After this decision, if elections get cheaper, it will be a great service to nation. If elections get cheaper, it will be a good beginning," Jaitley told reporters in New Delhi.
His predecessor, P Chidambaram of the Congress, said that his party will fight elections according to rules and regulations.
"I don't know... You must ask people who spend large amounts of money in elections. I don't know if people stash cash three months ahead of elections. I don't know. I know that people pull out money at the time of elections and spend it for elections. I don't know if people put it in gunny bags or suitcases and store it somewhere. I don't know," he said to queries on the impact of the government's decision on political parties.
"The Congress party, in anyway, did not have too much money even in the last elections," he said.
Swaraj India leader Yogendra Yadav told IANS that he supports the decision but it is mainly aimed at checking counterfeit currency notes.
"The prime minister has tried to make virtue of this necessity. His party has made grand claims about this decision being a historic game changer in the fight against black money and terror. There is not much to justify this propaganda.
"This decision would not affect much of the black money that has entered the stock market or real estate or has been parked outside the country via dubious financial instruments," he said.
With inputs from agencies