Fraught transactions: The ethics of monetary exchange in India

by Ajay Gandhi

Working Papers WP 16-01
March 2016
ISSN 2192-2357 (MMG Working Papers Print)

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Since the 1950s, public discourse in India has been replete with references to ‘black money’. This generally denotes undeclared or illicit income, sometimes in foreign accounts. Under post-independence socialist rule – so as to circumvent taxes, controls, and regulations – black money pervaded ordinary exchange and political financing. Today, important purchases have white and black ratios, and public figures vow to retrieve black money in Swiss accounts. Black money is, at once, a means to transact business, a barometer of value, an elusive spectre, and a moral outrage. It suggests how money can be differentiated, converted, corrupted, and disguised.

Based on an ethnographic study of a popular neighbourhood in central Mumbai, I focus on a ration shop operator’s generation of black money from the diversion of publicly subsidized goods, the surrounding community’s moral critiques, and the owner’s conduits for his income. Black money can be understood in equivocal terms. As a moral critique rooted in notions of injustice and corruption, it acquires a spectral and pernicious character. Yet seen from the perspective of exchange and circulation, black money serves as a hinge between transactional orders, and thus as a tangible expression of relational ties and long-term outcomes.


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