Don’t Panic!

EOSTRE

By Pranav Mimani

On November 8, in an urgent move, Prime Minister Narendra Modi announced the ‘Demonetisation’ of Rs. 500 and Rs. 1000 currency notes. The swiftness of execution was such that these currency bills were effectively rendered useless within a couple of hours of the announcement. The reasoning behind such a move has been summed up in the official statement. A striking observation to be made out here is the lack of data numbers provided for by the Government and the connection made to national security. Let’s think about this policy action to analyse it to a certain extent.

The entire argument for or against demonetisation, essentially, depends upon the magnitudes of counterfeits and unaccounted cash. In the absence of data numbers as evidence, we lose context which then is substituted by our imagination and/or hearsay.  In case of black economy and counterfeit circulation, guess estimates vary widely…

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