Demonetization and the Black Economy by Arun Kumar

This move, it was claimed, was made to wipe out corruption, deter the generation of black money, weed out fake Indian currency notes and curb terrorism. Overnight, people in India realized that the cash in their pockets had no value. A window of fifty days was granted to 1.3 billion people to convert their old notes into new ones. 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 withit. India continues to grapple with the effects of this move. The black economy has not been