Modi’s Initiatives to Curb Cash Corruption: Progress Made, Challenges Ahead

India has long grappled with the issue of cash corruption, a systemic problem that undermines trust in governance, hampers economic growth, and perpetuates inequality. Since coming to power in 2014, Prime Minister Narendra Modi has launched several bold initiatives aimed at combating this entrenched issue. While these measures have yielded tangible progress in curbing cash-based corruption, India remains far from eradicating it completely.

Key Initiatives to Address Cash Corruption

  1. Demonetization of 2016
    Perhaps the most controversial and widely discussed measure was the demonetization of high-value currency notes in November 2016. The stated goal was to flush out black money, reduce counterfeit currency, and push for a more formalized, cashless economy. While it temporarily disrupted the cash-dependent shadow economy, its long-term impact on corruption remains debated.
  2. Digital India Campaign
    The Digital India initiative aimed to digitize public services, making them more accessible and transparent. By encouraging digital payments and e-governance, the government sought to reduce the reliance on cash transactions, which often serve as conduits for corruption. Platforms like UPI (Unified Payments Interface) and Aadhaar-linked payment systems have significantly increased transparency in financial dealings.
  3. Direct Benefit Transfers (DBT)
    Under DBT schemes, government subsidies and welfare benefits are transferred directly to beneficiaries’ bank accounts. This has curtailed the role of middlemen, who often siphon off funds intended for the needy. As of 2025, billions have been saved through DBT by eliminating fake beneficiaries and reducing leakages.
  4. Implementation of GST
    The Goods and Services Tax (GST) replaced a convoluted system of indirect taxes with a unified structure, reducing opportunities for tax evasion. Digital invoices and a centralized system have increased accountability and made financial transactions more traceable.
  5. Crackdown on Benami Properties
    The government also targeted “benami” (anonymous) property transactions to curb money laundering and tax evasion. Enhanced scrutiny and strict penalties for offenders have added another layer of deterrence.

Progress Achieved

These measures have made a dent in systemic corruption, especially by increasing the visibility of financial transactions. Digital payments have surged dramatically, and initiatives like GST and DBT have streamlined processes that were previously opaque. The government claims to have unearthed significant amounts of black money, seized assets, and brought many offenders to justice.

The Roadblocks to a Corruption-Free India

Despite these gains, India is far from achieving a corruption-free system. Several factors contribute to the persistence of cash-based corruption:

  1. Cultural and Institutional Resistance
    Cash remains deeply ingrained in Indian society, especially in rural areas, where digital literacy is low, and access to banking facilities is limited. Moreover, institutional corruption, where officials demand bribes for basic services, continues to plague the system.
  2. Loopholes in Implementation
    While laws and policies are in place, enforcement remains weak. Political and bureaucratic influence often dilutes anti-corruption measures, and offenders find ways to exploit loopholes.
  3. Shadow Economy
    A significant portion of the Indian economy operates informally, beyond the reach of regulatory frameworks. This shadow economy often serves as a breeding ground for cash corruption.
  4. Technological Limitations
    While digital payments have grown, the cybersecurity framework is still evolving. Cases of fraud and misuse of digital platforms undermine trust and adoption.

Conclusion

Prime Minister Modi’s initiatives have undeniably moved the needle in India’s fight against cash corruption. They have introduced greater transparency, accountability, and efficiency in governance and financial systems. However, achieving a corruption-free India requires sustained efforts beyond government action. A cultural shift toward ethical practices, robust enforcement of anti-corruption laws, and the inclusion of marginalized populations in the formal economy are critical to realizing this vision. India has taken important steps forward, but the journey to a corruption-free society remains long and arduous.

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