Demonetization is defined as stripping of money which is prevailing as legal tender in the country.In india demonetization took place on 8th november and without intimation prime minister of the country narendra modi declared 500,1000 and 5000 notes as illegal.This move created a havoc in the country .This move is done to eradicate society from black money holders and curb the illicit activites from outside india .There are many countries like china,pakistan etc which are indulged in nefarious activites .they supply counterfieted notes in the indian economy .To stop this funding and to get rid out of this shadow economy which were ruining the Indian economic system,this move was planned.
did this move really curb black money?
Many of the economists claimed that this move is very pathetic with wrong excecution,it would not only disrupt the overall economy of India .It would also slow the paceof gdp growth.hence,it would make India's growth suffer .But on the otherside, Many elites were also supported the big decision took by the prime minister.MICROSOFT ceo, bill gates,said in an interview that this is one of the smartest move performed by the indian prime minister which would benefit the country in along run.
Effects of demonetization:
This move created havoc among the people across the country .There was a long in front of all the banks and atms. There is shortage of everything in the market .Buisness stalled for some days and people were unable to things of daily usage .ATMS WERE running out of cash .All these created wary in the people's mind .
but this battle against black money is not ended till government takes actions against benami transactions because most of the black money hoarded by the people are not in the form of cash but in the form of immovable property.