evidence: The evidence so far is that Mr Modi’s political instincts are correct. At least for the present, the population is willing to give him the benefit of the doubt, as demonstrated through opinion polls, from by-election results, and by the rather muted response of the opposition in the recently concluded winter session of parliament. Through this move Mr Modi has also started a national conversation for reform of political parties and election finance. He has not so far made specific moves in this area, generally seen as the font et origo of the black economy, and the associated wide pathology of criminals in political office in all political parties. [...] Through his speech on 8 November and his various public addresses since then Mr Modi has clearly embraced this initiative as a part of a transformational crusade, with considerable implications for his direct political accountability. Many observers (including the former RBI Governor Dr Rajan, when he was Chief Economist of the IMF) had questioned whether India could ever achieve its full potential through the incremental change characteristic of a constitutional democracy. After two years of relative economic caution, the demonetisation shock represents a decisive break with the past, though not perhaps what economists had in mind. The first and most important judgement will be political and will become evident in a matter of months. Partly dependent on that judgement, and on follow-up actions in the Budget, the full economic consequences will only become evident over the remainder of Mr Modi’s term.