Demonetization of Currency Is Not the First Time Done In India

Hit Brother

8 years ago

Demonetization of Indian Rupee Note 500 and 1000, nevertheless is the very bold decision by the NDA government. Because BJP also has leaders who are having black money stocked in the 500 and 100 Rupee note. Demonetization was not the first time done in India.

In 1978, when the Morarji Desai government had decided to invalidate the currency notes of Rs 1,000, Rs 5,000 and Rs 10,000 denomination, the then Finance Ministry was headed by a strong-headed civil servant from Gujarat – Haribhai M Patel. Desai was absolutely intolerant towards corruption and criminals in politics. At the instance of Patel, Desai agreed to go ahead with the ban on currency notes of Rs 1,000 and above in denomination. Much of the currency with higher denomination were stocked by the traders of India and that steps were made them to use that to burn, or somewhere they were not showing it to the government to avoid penalties or any tax.

Contrast this with today’s situation, and you will quickly realise the difference. Notes of Rs 500 and Rs 1,000 denominations are much more prevalent than even the smaller currency notes. In ATMs across the country, high denomination notes are the only available legal tender and this has practically pushed the smaller denominations out of circulation. With the preponderance of higher denomination currency, it became normal to transact in these notes across the social spectrum.

The most sinister aspect of the dominance of higher currency notes, however, pertained to the growth of terrorism and the spurt in corruption. For instance, Pakistan’s Inter Service Intelligence (ISI) took advantage of the situation by introducing a large chunk of counterfeit currencies all over the country – to fund terrorism and spread radicalisation.

A special cell of the Central Bureau of Investigation (CBI), that deals with counterfeit currency, came across many instances where bags of fake notes were being pushed from Bangladesh into India – in West Bengal and the North Eastern states – in order to finance insurgency. Despite the best efforts of the Indian security agencies, it seems that it is rather impossible to purge the economy of counterfeit currencies without employing such a drastic measure.

A much deeper malaise was also evident in politics, where corruption effectively subverted the system. Recall the US diplomat’s cables that were revealed on WikiLeaks, exposing the cash for vote scam at the fag end of Manmohan Singh’s term as prime minister. The US diplomat recounted how he was shown boxes full of cash, to be used as bribes for members of Parliament.

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The BJP’s capacity to raise funds for the upcoming elections would be grossly limited in view of these restrictions. Like other parties, the BJP is as much infected by black money and corruption. Similarly, in Modi’s home state of Gujarat, where Assembly elections are due shortly, the ban on currency notes would go against the grain of traders who have the tendency of stocking money.

During the election in the year 2014, the people of India chose Modi as their leader because of his bold decision and #NationFirst policy. What people of India expected from him , he is doing part. People are well connected to their leader and PM Modi already realized that with the use of the Information Technology, he will be more connected with the people of India. He is considered powerful leader of the world who is committed to fight against corruption, black money and terrorism.

On winning U.S. Presidential Election, Trump policy against terrorism and work with Russia may change the world dilemma, where India will play important role. Sooner or later India will be member of NSG and security council of United Nation, it doesn’t matter who much China protest it.

If people of India sincerely deposit their black money and the government has the sufficient currency note to replace or exchange these old notes then India might become the world largest economy. The questions which are still going into the mind by demonetization of old 500 and 1000 rupee note they why goverment is coming with the new 500 and 2000 rupee note. How the new higher denomination of 2000 rupee note will help in fighting against the corruption or black money? Hope PM Modi has the answer of these questions.