09/05/2017 9:03 AM IST | Updated 10/05/2017 9:30 AM IST

Houses Of Worship Are Among The Unintended Victims Of Demonetisation

Donations aren’t what they used to be.

Mukesh Gupta / Reuters

On a spring night in Delhi, pilgrims and tourists from all over the world make their way to the Nizamuddin Dargah, a shrine which houses the tomb of one the most famous Sufi saints. The visitors sit on the floor in the large open area outside the mausoleum to hear qawwalis, or Sufi devotional music.

First starts the drum, then other musicians join in with the harmonium and with their voices. Soon, the crowd sways to the music.

To show their religious commitment and appreciation for the music, devotees approach the musicians and drop rupees in front of them. Some can spare only a couple of bills; others have stacks of cash and make a show of bestowing them. During the few hours they spend playing, the qawwali musicians will bring in piles of bills—sometimes over ₹20,000.

Syed Hammad Nizami, one of [Nizamuddin Dargah's] caretakers, estimates that donations have fallen by 70% since November.

Besides listening to music, worshipers lay garlands and sweets around the tombs of the saints, or purchase shawls to lay on the tombs in a multi-coloured tapestry.

To support the shrine's upkeep and charitable activities, visitors also leave cash on the tombs or in wooden donation boxes.


But donations—to the singers or the shrine—aren't what they used to be. Religious organisations across India have seen a fall in contributions since the government's announcement last November that the two largest bills, the ₹500 and ₹1000 notes, were no longer valid.

Syed Hammad Nizami, one of the shrine's caretakers, estimates that donations have fallen by 70% since November. His family has run the shrine for centuries—they rely entirely on cash offerings for the dargah's operations, including charitable programs and workers' salaries. The shrine distributes free food twice daily and runs a madrasa that serves 150 students.

When donations plummeted, the family had to find funds elsewhere to maintain these programs.

"At that time it was very hard for two, three months, so we organised wealth from our savings," Nizami says. They have seen a moderate recovery, but contributions are still far below usual levels.

"Worship is not changed," he says. "People are coming continuously. But people don't have the money to contribute."


In November of 2016, the Modi government rolled out its plan for demonetisation. Overnight, the government took all ₹500 and ₹1000 notes out of circulation and introduced new ₹500 and ₹2000 bills. Limits on exchange and withdrawal resulted in a severe cash crunch nationwide.

The government announced the move to attack and weaken a growing counterfeit market linked to terrorism and corruption, as well as to stem a largely untaxed economy conducted in cash.

Some also speculate that the announcement aimed to sway public opinion ahead of upcoming elections. But its surprise implementation—with under four hours' notice—upended the economy.

People scrambled to get their hands on usable bills, and businesses across all industries suffered as spending fell.


The Nizamuddin shrine isn't the only religious institution feeling squeezed.

Five miles away at the Jama Masjid, one of India's largest mosques, donation boxes have yielded disappointing returns for months. Tariq Syed Bukhari, a member of Delhi's leading Sunni family and an imam at the Jama Masjid, says the mosque has cut operating expenses because of the drop in contributions. "I would say, as of now, the position is a little bit improving," says Bukhari. "But from November until January, [the drop] was more than 50%."

[A]ccording to Bukhari [an imam at Delhi's Jama Masjid], religious organisations face limited options... "You can't put an entrance ticket on the mosque."

But the mosque hasn't cut down on charitable activities, Bukhari said, and has continued feeding families in need by negotiating to receive food on credit. The mosque feeds a couple dozen families monthly and expects that soon donations will improve enough to repay the loans. Its most important charitable activity is providing iftar, the fast-breaking meal, to over 100 people daily during Ramzan, which begins in the last week of May. "We still have time," says Bukhari.


Other groups have been luckier. Rushi Rathashriji, a Jain nun in Ahmedabad, says that demonetisation didn't impact her even though Jain nuns rely entirely on donations for income. "Everybody was giving just the usual. Nothing changed," she says.

The Jain vow of Aparigraha, or non-possessiveness, requires Jains to give excess income to charity. Rathashriji guesses that this is responsible for her stable income. "Since people have already decided what percentage to give, they made up for it two or three or four weeks later when they had the cash."


Shrivatsa Goswami, the guru of the Caitanya Prema Sansthan Ashram, views demonetisation as a gift. "It was not at all a point of any suffering or any pain," he says.

His ashram is in Vrindavan, a town over a hundred miles away from Delhi in Uttar Pradesh. Goswami notes that Vrindavan's smaller size and economy may be partly why it is less opposed to demonetisation. Since the restrictions limit withdrawals to ₹4000 a week, a sum that he says many poor Indians "will never see" in that period, he argues those below the poverty line are unaffected.

Shrivatsa Goswami, the guru of the Caitanya Prema Sansthan Ashram, views demonetisation as a gift. "It was not at all a point of any suffering or any pain," he says.

Instead, he believes that the backlash was created by corrupt officials and media hype. Ordinary people, he says, took demonetisation as "a good intent for first step towards cleaning the system."

As evidence, he points to the recent elections in Uttar Pradesh, which overwhelmingly elected the BJP. If demonetisation had harmed most citizens, he says, the results would have been the opposite.

Goswami supports the government's reforms. One of his major gripes is the lack of taxpaying citizens: just over 2% of India's population pays income tax.

"That wrong has to be corrected," Goswami says. "And some harsh measures have to be taken care of. And now, because of this political stability, maybe more harsh economic reforms will come."


While some leaders feel this is a needed reform, others continue to feel the burden of demonetisation. At the Jama Masjid, Bukhari says salaries for their approximately 25 employees have been cut, and he doesn't know when wages will recover.

Like many houses of worship nationwide, the mosque is looking for ways to cope with the unexpected hardship. But according to Bukhari, religious organisations face limited options because of their public and religious nature: "You can't put an entrance ticket on the mosque."

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