Impact of currency ban and Demonetisation In India
Monetary and fiscal policy is usually the realm of Central bankers. The Reserve Bank of India (“RBI”) makes decisions and communicates them to Banks, followed by an appropriate Press Release. But the NDA government has proven itself exceptionally innovative and media-savvy, and thus, on November 8, we saw the perhaps unprecedented spectacle of an Indian Prime Minister making a currency-policy announcement. In the course of a lengthy speech, the Prime Minister Narendra Modi announced that with immediate effect, all notes of Rs 500/- and Rs 1,000/- would be deemed invalid currency. Provisions for converting the same into smaller denominations and depositing into accounts were also mentioned, and while the final contours of the change might take some time to be known, we can look at the immediate impact on the common man basis the information that is currently available: 1. Does not affect your wealth – unless you have a lot of unaccounted money Ordinary people do not have a lot