Demonetization completes one year

  • Demonetization completes one year
08-11-2017 | Pratidin Bureau. |

Exactly a year back, on November 8th, Prime Minister Narendra Modi announced demonetisation of Rs. 1000 and Rs 500 currency notes, which sent ripples across the nation. There have debates, accusations, and counter allegations regarding the usefulness of this mechanism, which wiped out 86% of total currency in the country overnight.

Following PM Modi’s announcement within 12 hours, Rs. 15.44 lakh crore of Rs. 500 and Rs. 1000 currency notes became invalid and it impacted every citizen of the country be it business, corporate, unskilled labourers or housewives.

Long queues were witnessed outside ATMs, as the new currency notes slowly started trickling in, even as economies of India changed daily. It definitely took some time for everyone to settle down, but the impact was remarkable.

According to PM Modi, this was a war against black money and tax evaders and the results were hotly debated that the implementation of demonetisation was efficient or not.

Meanwhile, the use of credit cards saw a massive spike after the note ban exercise. According to a survey, about 57% of the cardholders are doing more transactions than they did a year. Also after the deposits in banks following the demonetisation exercise, it is evident that more accounts are under the scanner of IT (Income Tax).

Though the amount with the public has shown a significant increase, but Rs. 1.31 lakh crore is yet to be pushed back to the public. On October 28, 2016, Rs. 96.46 lakh crore was the banks’ time deposits (i.e. fixed deposits), but almost a year after , Rs. 103.65 lakh crore was the fixed deposits seen with the banks as on October 13, 2017. A total rise of Rs. 7.67 lakh crore or 8% increase in the fixed deposits.

Following demonetisation, India's Gross Domestic Product or GDP growth rate has slumped down to 6.1 per cent in the January-March period, lowest in more than two years. This growth rate was unexpected as the Central Statistics Office earlier in January had estimated 7.1 per cent growth as compared to the 7.6 per cent in 2015-16. With this March quarter report, India lost its status as the world's fastest growing major economy.

Tags : Demonetization anti black money day Narendra Modi Indian Economy

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