Vol. 4, Issue 1 (2017)
Demonetisation: A surgical strike on black money
Author(s): Dr Ashok Gupta
Abstract: At the stroke of midnight on 8th Nov 2016 our PM Sh. Narendra Modi demonetized the Rs 500 and Rs 1000 as a legal tender. Since then much has been said about the pros and cons of demonetisation. Primarily our PM has followings things in mind to achieve through demonetisation 1) To wipe out black money in the economy. 2) To lower the cash circulation in the country which "is directly related to corruption in our country, "according to PM Modi. 3) To eliminate fake currency and dodgy funds which have been used by terror groups to fund terrorism in India. Meaning: Demonetization of currency means discontinuity of the particular currency from circulation and replacing it with a new currency. In the current context it is the banning of the Rs 500 and Rs 1000 denomination currency notes as a legal tender. Objective: The government’s stated objective behind the demonetization policy are as follows; first, it is an attempt to make India corruption free. Second it is done to curb black money, third to control escalating price rise, fourth to stop funds flow to illegal activity, fifth to make people accountable for every rupee they possess and pay income tax return. Finally, it is an attempt to make a cashless society and create a Digital India.