Kudos to Prime Minister Narendra Modi for demonetising currency notes of Rs 500 and Rs 1,000 denomination. In 1978 Morarji Desai had discontinued the circulation of Rs 1,000, Rs 5,000 and Rs 10,000 notes for curbing black money. If politicians are panicking then it only shows that the government has taken a right step. We ordinary people are with you and it is only short term pain for long term gain.
The scrapping of high denomination notes is a blow to the anti-India terrorists, smugglers, black money hoarders and counterfeit note manufacturers operating from neighbouring country. Common man will face minimum inconvenience as currency can be exchanged till December 31, 2016. On the other hand, it’s a challenge for banks to replace old notes as they will have to stock enough notes for achieving this objective. However, introducing new Rs. 2000 should not encourage people to hoard money.
In a fraction of a moment the 10 lakh crores of black money has become a piece of paper. All black money of political leaders have become piece of paper which cannot be even used as tissue paper as it does not even absorb water. See how the real estate prices will come down. Builders who have built apartments in Bangalore with black money are holding unsold 375,000 flats idle for the last 3 years even without reducing the price. It is indeed a bold move to make the movement of money in a most legalised form. The Finance Ministry has taken a right step to eliminate black money.
It is a good move from the government however a lot of study and thought is required for implementing this move. Citizens may lose confidence in the financial system to some extent. Most of the black money is held by corrupt politicians and greedy businessmen not only in India but across the world. We are all ready to face some hardships for the betterment of our country’s economy.
On the other hand, crooks may download their money into banks by producing identity proof and will slowly withdraw funds. Black marketers may also try to print counterfeit 500 and 2000 rupee notes. Such type of frauds can be eliminated by asking people to perform transactions above Rs.1000 by issuing cheques or using credit/debit cards. They can also use net banking and mobile wallets to reduce the usage of cash.
However demonetisation of Rs 500 rupee note may create hardships for genuine people. The introduction of Rs 2000 notes will also create troble for citizens as they might find it difficult to procure change for it. Let us hope the step taken by government to curb black money brings desired results.
(The views expressed by the author in the article are his/her own.)