The evening of 8 November 2016 was a crucial time for India. All of a sudden and without any prior notice, PM Modi had announced demonetization of Rs 1000 and Rs 500 currency notes from next day 9 November 2017.
By the government, it was said one of the biggest drives against black money in India. But the final result tells a different story all together.
Reserve Bank of India, in its annual report reveals that Rs 15.28 lakh crore demonetized currency has already come back to banks as of 30 June 2017. Actually, a total of Rs 15.44 lakh crore amount was in the circulation of demonetized currencies before announcement. Of which, 98.96% currency has been return to different banks already.
It raises a burning concern that if 99% banned currency notes are back in the banking system again, then where the hell Rs 3 lakh crore black money is???, as claimed by PM Narendra Modi on last Independence Day speech to the nation! The demonetization drive was claimed to be very successful on the point of black money and punishing the culprits who stashed money unaccounted, means black.
Actually, banning banknotes has never been a great measure to tackle black money and corruption. It has been proved this time in India also.
Moreover, the amount of money, that has been spent to print new notes and circulate in market among people becomes very high in comparison to the amount not came in the banking net. The actual data on these points are yet to be disclosed properly by the RBI. Due to huge expenditure on printing bank notes, the demonetization comes as a big loss for the country.
The only benefit of this mega-drive comes is that more people came in the net of banking and now doing banking and transaction digitally. It increased the number of tax payers and transaction in digital mode becomes a need now.