Politics, economics and military of India 2017

While it's time to say goodbye to 2016, certain developments of the year are not going to bid us farewell; they will spill over into the coming ‘Happy New Year'. And, not only will they linger, but they will shape the events that shall unfold in the coming weeks and months of 2017. Offhand — and one can have the luxury of off-handedness when the chill of the outgoing year is supposed to melt into warmth in the following one — the most important of these developments is the Union Government's November 8 decision to demonetise the old high-value currency notes and replace them with new. It set off a flurry of actions, both political and economic, that dominated media headlines and drawing room chatter for the better part of November and December. But the story has just begun, and people are eagerly anticipating the outcome. Since the Government has said that demonetisation is only the first step, more are being expected — and those should happen in early 2017. All eyes are now on the Union Budget which, if the Government has its way, could be presented on February 1, 2017, instead of on the last working of February (which has been the convention for decades). The Union Budget has always been important, but this time around it will be doubly so because the people are keen to see how it reflects the post-demonetisation situation. Will Union Minister for Finance Arun Jaitley assuage the public by bold reforms in direct taxation that impacts the vast majority of earning and pensioned individualsIJ Experts at least are in no doubt that the shadow of demonetisation will loom large over the 2017-18 Budget. And not just the Budget; even the implementation of the Goods and Services Tax regime has got entangled in the demonetisation decision. Will the deadline be metIJ

That's economic, but there is the political aspect too, which must be making strategists and leaders of various parties burn the midnight oil. People in as many as five States, including the politically most crucial Uttar Pradesh, will elect their Assemblies. Though leaders have been speaking of local issues and exhibiting their present and past track records in development politics, they all realise that the 2016 demonetisation will impact the results of the 2017 elections. Since it is difficult to wish away the elephant in the room, leaders on the campaign trail have already begun raking up the issue by giving it a twist to suit their political preference. It would not be an exaggeration to say that the 2017 State Assembly elections will be, even if to an extent and not entirely, a referendum on the 2016 decision to demonetise — and re-monetise.

Besides the political and the economic, there is a military spillover from 2016. The surgical strikes that the Indian Armed Forces carried out inside Pakistan following the attack on an Army base in Uri in Jammu & Kashmir are unlikely to be a one-off. The Government will have to sustain its ‘fitting response' in 2017 as well, given that Pakistan will not mend its ways. In fact, expectations are that the next ‘surgical strike' will be even more retributive, and demonstrably so. Alongside the military is the diplomatic outreach. How soon will India finally become a Nuclear Suppliers Group member (an unfinished 2016 project)IJ Can it manage the Chinese opposition to sanctioning anti-India terrorists (again a 2016 initiative)IJ And finally, how effectively can New Delhi bind with Donald Trump as the US President and deal with a Russia that is surely moving away and into an orbit hostile to IndiaIJ