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Demonetization and the Black Economy
Hardcover
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ISBN13: 9780670090075
Publisher: India Portfolio
Published: Jan 1 2017
Pages: 344
Language: English
On 8 November 2016, the prime minister announced the immediate cancellation of all
Rs 500 and Rs 1000 denomination notes, wiping out 86 per cent of the currency in
circulation. India's well-functioning economy went into a tailspin.
This move, it was claimed, was made to wipe out corruption, deter the generation of black
Businesses, especially in the unorganized sectors, came to a grinding halt. Patients in hospitals faced huge problems, farmers had difficulty buying inputs, weddings were scaled down, and fishermen watched their catch rot. Many lost their jobs and could not support their families.
A year later, the RBI announced that 99 per cent of the old currency notes had been deposited with
it. India continues to grapple with the effects of this move. The black economy has not been
dented; counterfeiting and terrorism continue; the credibility of the RBI, banks and currency is
damaged; the accountability of the Parliament and the prime minister has been eroded; and the social divide
has widened. There have been many arguments and counter-arguments from both sides, but they have
missed the complete picture.
Demonetization and the Black Economy, for the first time, lucidly explains the story
of demonetization along with its effects on the economy.
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