The Tsunami On Black Money

Bold Step in Demonetising Rs 500 & 1000 Notes. GDP May be hit in the short run – Growth could pick up in the long run.

- TN Ashok

On November 08 this year India was struck by a monetary Tsunami. A tidal wave sucked out a whopping 22 billion currency notes in circulation at one stroke at midnight. Some 16 billion Rs 500 notes and six billion Rs 1000 notes had become worthless pieces of paper all of a sudden. Prime Minister Narendra Modi shocked a nation with the stunning announcement that Rs 500 and Rs 1000 notes were being declared invalid legal tender. New high value Rs 2,000 and Rs 500 currency notes with new security features were being introduced.

People who were chasing news on different networks on the Donald Trump Vs Hilary Clinton Presidential race in the United States started switching channels to know what the next day held for them. A lot of drama preceded the TV announcement by the Prime Minister. A cabinet meeting had been summoned at short notice to discuss matters of national importance. When ministers paraded into the conference hall, for the first time, they were frisked by security men and told politely with folded hands to leave their mobile phones outside the room. Reportedly PM marched into the room, greeted the ministers and asked them to wait till he came back. No one had an inkling of what was happening. Apocryphal reports circulated in the media that ministers were locked in.

The Prime Minister reportedly went to Rashtrapathy Bhavan to meet President Pranab Mukherjee and apprised him of the announcement he was going to make on TV and the follow-up measures that the government would be taking to ease pressure on the citizens. Meanwhile, ministers were asked to watch TV for the announcement.