At 8 PM on 8th November 2016, Prime Minister Modi made a surprise announcement: Currency notes for INR 500 and INR 1000 were being declared invalid with almost immediate effect.
The stated objective was to put an end to black money, terror funding and rampant forgery.
Six days later, I continue to be impressed with the secrecy and swiftness with which this decision was implemented. At the same time, it is clear that was not thought through. For one, it is astounding that the RBI would design and print currency notes that does not fit into standard ATM machines.
The shock and awe tactics does seem to be having some effect on people who had got accustomed to hoarding cash. Consider these examples -
- Big Bazaar Noida has been selling grocery cash-cards like never before. From 8 Nov., they have been open till midnight, selling cards to ladies lining up with wads of 500/1000 notes. They bought up whatever is available and walk away saying, "Keep the change!"
- At Sector-18 market, on 8 Nov., jewelry shops were open till midnight and the sales personnel hit their six-month target in just four hours!
- The sweepers and cleaners at Tower-3, Unitech South City, Gurgaon, discovered that some resident(s) had dumped poly-bags full of currency notes down the garbage-chute. All the notes had been carefully snipped with scissors so they were of no use to anybody.
- Just about all ATMs in the NCR Delhi region have serpentine queus of people waiting to use the ATMs. Most of them are young, unemployed boys working on a commission basis - for every INR 4000 withdrawn, they pocket INR 400.
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