Their love for cash and the BJP explains why banias are furious but won’t show it

In these confusing days of demonetisation, for banias, the distinction between “on the record” and “off the record” has acquired the same significance as the difference between black money and white money.

On the record, most members of the bania community of traders and merchants hail the demonetisation policy announced earlier this month. But if you reach out to them through a person whose confidence you enjoy, they mostly express shock, and outrage, and pessimism, obviously, off the record.

The refrain you hear most among banias is: Prime Minister Narendra Modi has betrayed those who have stood steadfastly behind the Rashtriya Swayamsevak Sangh over the decades. Banias have long voted for the RSS’s political front – the Bharatiya Jana Sangh and its later avatar the Bharatiya Janata Party – even when it was not within sniffing distance of power, and provided it with their silent support and money.

Ordinarily, such perceptions of betrayal would provoke social groups to take to the streets. But not so the banias, who are Vaishyas – the third-highest in ritual status of the four divisions of Hindu social hierarchy.

Reported to form just 2.7% of India’s population in the 1931 Census, and spread across India, they are not numerous enough to make their protests count.

More tellingly, demonetisation holds out different meanings, and futures for bania traders, say, in Delhi’s Chandni Chowk, and bania owners of corporate giants (think Ambani, Adani, Mittal, Birla). This makes it hard to rally the community from which professionals, including journalists, have emerged in recent decades.

The bania’s love for cash

But the reluctance to vent their anger publicly is also because caution is among the defining traits of banias: they are wary of hurting their businesses through rash decisions.

Another reason for it, though, is fear – the fear of the state that could entangle them in tax-evasion cases or organise raids on them. Pragmatism demands that the trading community keeps out of the state’s line of fire.

In Delhi’s Walled City, host to one of Asia’s biggest wholesale markets, a trader showed me the exchanges among members of a WhatsApp group created for those in his trade. Messages expressed dismay over the sharp dip in sales, and there were biting remarks about Modi. Demands were voiced for the president of their organisation to publicly take a position against demonetisation.

“On November 9, the president welcomed demonetisation,” said the trader who showed this correspondent the WhatsApp exchanges. “Since then, he has been silent. He knows a word of criticism from him will have the tax authorities breathing down his neck.”

This sense of vulnerability also arises from the bania subculture of hoarding cash. Fostered over centuries, the community obsessively holds on to cash to tide them over possibly desperate times in the future.

Insecurity is an aspect of the bania mentality. This was illustrated to me through examples of wealthy merchants who periodically borrow from the market even though they do not need the loan. They then return the money with interest after a month.

Through this technique, wealthy banias ensure that their credibility is maintained in the market, and they can access loans should the need for money arise in the future.

This is as much about image. “If a bania were to suddenly borrow [money] one day, people would assume he has gone bust,” said a community member from Aligarh in Uttar Pradesh. “People will then respond to him as they would when they fear a bank is on the brink of going under.”

To depict the bania mentality, a trader in Delhi cited the example of his father, who was once approached for a loan a few decades ago. Despite having a cash reserve of Rs 2 lakhs – a huge amount at that time – the trader’s father asked the person to come next week.

To his son, the father explained, “What if I have to make payments to my supplier? What if there is an emergency? What if…?” There are indeed no limits to financial insecurities dogging a cautious person.

Partly, these insecurities are typical of those who are dependent on their personal resources to negotiate life. They have no pensions to rely upon in old age, the spectre of illness haunts them, and there is the perennial threat of a sudden slide in their business fortunes. Insurance policies can neither take care all of exigencies nor defray all expenses.

“It is part of their deep-rooted psychology that they should have cash which they can access even late night,” said academic and writer Purushottam Agrawal. “Insecurity breeds automatically in self-employed people who, unlike, say, an academician, have no institutional support for old age and adversities.”

Since the bania subculture values personal cash reserves, doing business in cash or fudging books or evading taxes is, to an extent, considered illegal but not immoral. This is further reinforced by the fact that cash transactions are the only way for many to maintain a margin of profit in the fast-changing economy.

For instance, the proliferation of automobile companies has depressed the market of spare parts for cars. Automobile behemoths offer warranties for two to three years, and credit finance has people replace their older cars instead of repairing and refitting them as was the dominant practice even a decade or so ago.

Delhi’s Kashmiri Gate market deals in automobile spare parts. On the day this correspondent went there, it wore a deserted look but for the long queues at banks. Tucked inside an alley, surrounded by his idle staff, a wholesale dealer said, “Most of our customers come from Rajasthan, Haryana, and Punjab, where the market for second-hand cars still flourishes. They are not part of the cashless economy.”

He cited the hypothetical example of a car dealer in Karnal, Haryana, who secures spare parts from Delhi through a supplier. “The supplier takes a cut of 1% or 2%,” the Delhi-based wholesale dealer explained. “If the dealer does not deal in cash, he will be run out of business.”

The wholesale dealer paused and said, “Can’t Modi see that demonetisation will ruin the grey market in every sector?”

From this perspective, big business stands to gain at the expense of the small bania, who fears his own ruin and that of the workers dependent on him.

So what we are seeing is perhaps a schism in the bania community engaged in business. Those in modern businesses, in a corporate set-up, are likely to be less anguished by demonetisation.

Banias’ love for the BJP

Banias are shocked by demonetisation because it was not, as one of them said, executed by the Left. After all, the BJP has always been a pro-business party and believed in limiting the state’s role in the economy.

They say this pro-business attitude was the reason they gravitated to the Sangh Parivar in the first place, expressed not necessarily through votes, but through sympathy – often described as silent support – for its politics.

After Independence, apart from the Sangh, there were essentially three principal political formations: the Congress, the Socialists and the Communists. Banias would not have backed the last two as their ideological positions were perceived to be anti-business.

The Congress lurched to the Left too, passing a string of labour reform laws and rent ceiling Acts, which made it impossible for landlords to evict tenants paying only small sums as rent, and diluting the right to property. It was the state, not private enterprise, which occupied the commanding heights of the economy.

This dampened the ardour of banias for the Congress, but pragmatism demanded that they carve a space for themselves in the ruling party and vote for it. As the Congress turned leftward, socio-political dynamics pushed the Sangh to adopt a more pronounced pro-business position.

Rightwing ideology apart, Partition saw an influx of refugees from the territory then called West Pakistan. A segment of them settled in metropolitan cities, opened shops and entered various trades. For them, their Hindu identity was paramount. During the violence of Partition, the Rashtriya Swayamsevak Sangh was their principal protector. It was only natural for refugees to line up behind the RSS.

For electoral reasons, therefore, the RSS’ political wing, Jana Sangh, developed a sharper pro-business outlook. In Delhi, for instance, a relationship was forged between the Jana Sangh-BJP and bania-Punjabi traders. It enabled the Sangh to emerge as the principal opponent of the Congress in the national capital.

Another reason most banias cited for their support to the RSS was that they could rely on the saffron outfit’s cadres for everyday protection for their businesses, which were targeted by extortionists. “At least, we could hope for RSS cadres siding with us, helping us,” said a member of the community.

But academicians contest these explanations. For instance, Thomas A Timberg, author of The Marwaris: From Jagat Seth to the Birlas, said, “During the nationalist movement Marwaris were split much as other business groups… Hindi-speaking intellectuals among whom there were many Marwari banias generally supported the Congress or sometimes the [Hindu] Mahasabha.”

In contrast to the explanations banias proffered for their support to the RSS, Timberg maintained, “I am not conscious of any indication that Marwari banias are more likely to support the BJP or RSS than other members of the Hindi-speaking upper caste-middle class in Northern India.”

On the street, though, the Jana Sangh was derisively referred to as a party of shopkeepers. In fact, some banias recalled that in their younger days RSS pracharaks would visit their homes and join them for meals. It certainly suggests the respect the RSS commanded among banias, who, however, out of pragmatism courted the Congress as well.

Banias’ schizoid approach

But this respect for the RSS was also on account of Hindu nationalism it promoted. In fact, the absence of Hindu religious idioms in the political vocabulary of the Swatantra Party – which was set up in 1959 as an alternative to the Congress – was why perhaps banias did not see it as an alternative to the Sangh.

“The Swatantra Party too was right-of-centre, believed in free enterprise and a diminished role for the State,” said Purushottam Agrawal. “But banias were not attracted to the Swatantra Party as it did not display the religiosity the Sangh did. In fact, Rajaji [C Rajagopalachari, the Swatantra Party’s founder] wanted Kashmir to be given to Pakistan.”

Most of today’s younger banias may not have heard of the Swatantra Party, but almost all aver that the BJP’s display of religiosity has had an irresistible pull on them.

They said that religiosity is a cultural inheritance handed down from earlier generations. This is why they are the biggest contributors to religious functions, sponsor community meals, finance jagrans (all-night religious vigils), and place great emphasis on upholding Indian cultural values, which is what the Sangh too claims through its opposition to Valentine’s Day, seen as a Western import, and imposition of a dress code on women.

“We are also diehard desh bhakts,” they said as an explanation for the appeal that the BJP’s brand of strident and increasingly militaristic nationalism has for them. In the worldview of banias, being Indian and being Hindu are fused together.

Yet they also argued that they are not anti-Muslim. After all, a businessperson is unmindful of the religion of his customer as long as he willing to buy. They could not quite fathom why Hindu nationalism invariably must turn against the religious minorities.

All this lead them to adopt a “schizoid approach”, suggested historian Dilip Simeon to Scroll.in, based on his experiences during the years he spearheaded the Sampradayikta Virodhi Andolan (movement against communalism), which was active between 1985 and 1992.

“During those days they opposed communal riots because of the disruptive impact on commerce, and yet adhered to communal ideas,” said Simeon. “The first impulse arises from daily life, the second expresses the Nietzschean will to power. There was a case in Meerut of a shopkeeper telling peace activists that while he was happy to donate for harmony, he had also donated for the Ram Mandir.”

These were also the years – in the late 1980s and early 1990s – during which the politics of Mandal and Mandir saw the BJP leapfrog into the national consciousness as never before. The upper caste, including banias, swung en bloc behind the BJP.

Said William Gould, author of Hindu Nationalism and the Language of Politics in Late Colonial India: “We could argue that one of the main attractions for these communities relates to the protection of their own high caste status, especially once the Sangh Parivar begun to mobilise around the issue of Mandir-Mandal from 1990. Banias were among communities who arguably had a reason to oppose the politics of reservation.”

Call it pragmatism or self-interest or reclaiming their ideological moorings, banias have been overwhelmingly both voters and financiers of the BJP over the last 25 years. It is this relationship that the demonetisation process has strained unduly.

Will banias desert BJP?

Asked whether they would desert the BJP, they began to promptly weigh the options before them. They said that the Congress seemed incapable of triggering a revival under Rahul Gandhi. Spelling out their calculations, one of them said, “Mulayam Singh Yadav, Lalu Prasad Yadav, Mayawati, Mamata – in comparison to them, Modi is still a safer bet. And Aam Aadmi Party has still to go beyond Delhi.”

But even he and others say that they are waiting for the economic consequences of demonetisation to unfold and gauge what the popular response to it would be. In other words, it is not the bania who will provide the lead in articulating popular discontent to whatever degree it may be present.

“We are not Jats who can hit the streets,” said the bania from Aligarh. “We are a people who flow with the river, not against it.”

Should there be protests and outburst of anger, be sure banias would operate behind the scenes, providing their silent support – as they once did to the RSS in the initial decades of Independence – and even contributing funds if the anger were to assume the form of a popular movement.

But there are traders who hope Modi would offset their current losses with generous tax rebates or initiate measures to rev up the slowing economy. Such measures will certainly have pragmatism overrule the hearts of banias, and may see them forgive Modi and the BJP for their current woes.

“But yes, at least 20% of us will not be voting the BJP for a while,” said one of them.

A few among them said that while their business makes them vulnerable, it is also their sole weapon. “If trade stalls, where would the Modi government be?” a bania asked.

Ajaz Ashraf is a journalist in Delhi. His novel, The Hour Before Dawn, has as its backdrop the demolition of the Babri Masjid. It is available in bookstores.