HAPPY DEMONITIZATION DAY
(NOTEBANDI DIWAS)
Today we have completed 6 years of demonitization, still it has been a hot topic and needs to be discussed.
In 2016, the Indian government under Prime Minister Narendra Modi made the sudden and unexpected announcement that certain high-denomination banknotes would no longer be legal tender.
The stated goal of this so-called “demonetization” was to reduce corruption, counterfeiting, and tax evasion, as well as to move the country towards a cashless economy. While there were some potential benefits to demonetization, it also caused significant problems for Indian citizens and the economy more broadly. Understandably, the sudden demonetization caught many people off guard. Those who had large amounts of cash on hand were left scrambling to exchange their old notes for new ones.
This was especially difficult for rural residents and those without bank accounts, who often had to travel long distances to exchange their money. The process of exchanging old notes also caused long lines and significant delays, as people had to wait for their turn to exchange their money. In addition to the inconvenience caused to citizens, demonetization also had a negative impact on the economy. As people rushed to exchange their old notes, there was less cash available for day-to-day transactions. This led to a decrease in consumer spending, which in turn led to a decrease
tone On November 8, 2016, Prime Minister Narendra Modi announced that all ₹500 and ₹1000 currency notes would be withdrawn from circulation and new ₹500 and ₹2000 notes would be issued in their place. The move was an attempt to crack down on black money, corruption, and counterfeit currency.
The decision was a huge shock to the public and caused widespread panic and confusion. While there are some benefits to demonetization, such as reducing black money and counterfeit currency, there are also several disadvantages, such as causing economic slowdown and inconvenience to the general public.
Killing black money was the major goal of demonetisation. Black money refers to money that now no longer accounted in the banking system for which tax isn’t always paid to the state.
But what has came about in reality? According to the RBI records, nearly the whole chunk of cash (more than 99 per cent) that was black came to the banking system. Of the Rs 15.41 lakh crore worth not invalidated notes, notes worth Rs 15.31 lakh crore have returned.
In February, 2019, the then finance minister Piyush Goyal informed Parliament that Rs 1.3 lakh crore black cash has been recovered via all anti-black money measures which include demonetisation. Remember, the authorities had originally predicted that as a minimum Rs3-4 lakh crore black cash gets extinguished out of doors the banking system because of demonetisation exercise alone.
Thus, information shows that demonetization changed into a failure in unearthing the black cash in the banking system.
What do you think about demonetization? Do you think it was a good or bad move? Let us know in the comments below.