By Andrea Januta and Ellen Ioanes

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

First starts the tabla, a small drum, then other musicians join in with the harmonium and with their voices. Soon, the crowd is swaying to the music, captivated. To show their appreciation for the music and commitment to the saint some devotees walk up to the musicians and begin dropping rupees in front of them. Some are timid, with only a couple of bills to spare; others have a stack of bills and make an elaborate show of bestowing them onto the musicians.

In the two or so hours they spend playing these devotional songs, the qawwali musicians will bring in piles and piles of bills — sometimes as much as 20,000 rupees.

In addition to listening to devotional music, worshipers lay garlands of roses and sweet candies around the tombs of the saints. Some purchase shawls to lay on the tombs in a thick tapestry of multi-colored cloth.

To support the shrine’s upkeep and charitable activities, visitors also leave cash on the tombs or in locked wooden boxes marked “Donations” in Hindi and Urdu.

70 Percent Drop

But donations — to the singers or the shrine — aren’t what they used to be. Religious organizations across India have seen significant decreases in contributions since the government’s sudden announcement last November that the two largest rupee bills, the 500 and 1,000 rupee notes, were no longer valid. (In dollar terms, these bills are worth just under $8 and just under $16, respectively.)

Syed Hammad Nizami, a descendant of the saint and one of the shrine’s caretakers, estimates that donations to the shrine have fallen by 70 percent since November. His family has run the shrine for hundreds of years and relies entirely on cash offerings for its maintenance and operations, including charitable programs and workers’ salaries. The shrine distributes free food twice a day and runs a madrasa that serves 150 students.

When donations plummeted, the Nizami family had to find funds elsewhere to avoid scaling back these programs.

“At that time it was very hard for two, three months, so we organized wealth from our savings,” Syed says. They have seen a moderate recovery since, but cash flows are still far below their usual levels.

“Worship is not changed,” he says. “People are coming continuously. But people [don’t] have the money to contribute.”

Fighting Corruption and Crime

In November of 2016, the Modi government rolled out its plan for demonetization and remonetization. Overnight, the government took all 500 and 1000 rupee 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 a largely untaxed economy conducted in cash. “Demonetization is truly the first major frontal assault on black money,” said Arvind Panagariya, the Vice-Chairman of the government’s policy think-tank, the Niti Aayog, in an interview with India’s Economic Times. “It sends a loud and clear signal that the prime minister is serious about combating corruption, and there is not going to be any compromise on this front.”

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

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

Effects Felt Across Religions

The Nizamuddin shrine isn’t the only religious institution feeling the crunch.

Five miles away at the Jama Masjid, one of India’s largest mosques, donation boxes are prominently displayed. But, these have yielded disappointing returns for several months. Tariq Syed Bukhari, a member of the leading Sunni family in Delhi and brother of the Shahi Imam of the Jama Masjid, says the mosque has cut operating expenses in response to the drop in contribution levels. “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 percent.”

But it hasn’t cut down on its charitable activities, Bukhari said. The mosque has continued feeding families in need, but to do so it had to negotiate to receive food on credit. The mosque feeds a couple dozen families every month and expects that soon donations will improve enough that it can repay the loans. Its most important charitable activity, however, is providing iftar, the fast-breaking meal, to over 100 people daily during the holy month of Ramadan. This year Ramadan begins in the last week of May. “We still have time,” says Bukhari. “Things will ease out by that time.”

Some Spared

Other groups have been luckier. Rushi Rathashriji, a Jain nun in Ahmedabad, says that demonetization didn’t impact her even though Jain nuns rely entirely on donations for their livelihood. “Everybody was giving just the usual. Nothing changed,” she says.

Jains are required to give one fourth of their income to charity as part of their religious practice — and wealthier Jains give more. There are many causes for them to choose from, including cleaning the Ganges, supporting impoverished citizens, and paying for the care of animals. Rathashriji guesses that this predetermination is responsible for her stable income level. “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.”

Many of the larger transactions, usually given to Jain nuns after weekly public sermons, are done by wire and are thus less likely to be affected by the cash crunch. As Jains are typically wealthier members of Indian society, this may also protect them somewhat from economic hardships of demonetization.

A Gift for Some

Shrivatsa Goswami, the guru of the Caitanya Prem Sansthan Ashram, views demonetization as a gift. “It was not at all a point of any suffering or any pain,” he says.

His ashram is located in Vrindavan, a town in the northern region of Uttar Pradesh. The town is over a hundred miles from Delhi and has a much smaller economy than the financial hub, India’s second richest city. He points out that this may be part of the reason that his town is less opposed to demonetization. Since the restrictions limit withdrawals to 4000 rupees 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.

Instead, he believes that the backlash was created by corrupt officials and media hype. Ordinary people, he says, took demonetization as “a good intent for first step towards cleaning the system. It’s not going to clean in one day, you know.”

As evidence, he points to the recent election results in Uttar Pradesh, which overwhelmingly elected the BJP ruling party responsible for demonetization’s implementation. If the policy had harmed most citizens, he says, the results would have been the opposite.

Goswami supports the government’s current reforms. One of his major gripes is the lack of taxpaying citizens: just over 2 percent of India’s population pays income taxes, according to the Indian government’s own figures. The burden disproportionately falls on working class Indians whose salaries are directly taxed.

“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.“

An Uncertain Future

While this may seem like a needed reform for some leaders, others continue to feel the burden of demonetization. At the Jama Masjid, Bukhari says employee salaries have been cut, and he doesn’t know when they will recover. Approximately 25 people are employed at Jama Masjid, including the imams, ticket sellers and cleaning staff.

While the mosque does charge small sums for permission to take photos or tickets to enter the tower overlooking the grounds, it does not come close to meeting the mosque’s operating expenses.
Like many houses of worship nationwide, the mosque is looking for ways to cope with the unexpected financial hardship. But according to Bukhari, religious organizations face limited options because of their public and religious nature: “You can’t put an entrance ticket on the mosque.”