India’s note ban has impacted the country in a variety of ways. One of the most important things to take note of and consider for the future is how to improve the digital infrastructure in India. This essay On Note Ban In India will explore how the note ban has impacted the cryptocurrency ecosystem in the country.
The improper use of notes has contributed to the generation of black money. The Prime Minister of India has given a go signal for the complete ban on the production and circulation of the old Rs. 500 and Rs. 1000 currency notes. There is great deal of confusion regarding the ban. The purpose of this essay is to analyze the ban of Rs. 500 and Rs. 1000 currency notes.Essay On Note Ban In India (Demonetization)
Essay On Note Ban In India
On 8 November 2016, the Government of India declare the ban on all ₹500 and ₹1,000 banknotes of the Mahatma Gandhi Series. This note ban is also known as demonetization. Demonetization is the act of erasing currency as legal tender. The current form of money is exposed from circulation and dismissed in the case of Demonetization. New forms of notes and coins are restored by the old ones. Nations often fully launch a new currency by replacing the old currency.
The most central thing about Demonetization is that notes and coins of a certain denomination are banned by the central government. There are some positive merits and also some demerits of Demonetization. When a new policy is established by the government, it has to face several challenges and barriers.
The mid-night act of changing the currency of the nation is something that India has witnessed before. Mohammad Bin Tughlaq in the 14th century changed the currency of his dynasty as an administrative measure. The purpose behind his measures was never wrong, however, he became unpopular by the majority due to the suffering caused to the public. This move was simulated by the currency that was in motion in Iran and China. The socio-political formation of Indian society has modified a lot in the past seven centuries. Therefore it is not suitable to compare and draw parallels between the history of Demonetization and the present storyline. Geologically speaking, many countries gauging through different continents have tried Demonetization.
In few countries, it proved to be a achievement while for the others it was a disaster. Counterfeiting or the act of preparing fake currency was extensive in Australia. To stop this application, the Australian Government changed the matter of the currency from paper to plastic. There was no negative effect of such a act on the economy of the country. The success of Demonetization in Australia can be credit to the fact that it is a developed State, hence the economy can handle these commute without any side effects. Ghana, Nigeria, and Zimbabwe were in a totally different position altogether. These were all debt-ridden countries that ban their old notes but the economy collapsed due to the inflationary trend that followed. The national of Myanmar and the Soviet Union reacted differently. There were mass disapproval in Myanmar and the Soviet Union disintegrated after a coup due to Demonetization.
India is a very diversified country and Demonetization was levied to achieve particular targets. Hence, the result of Demonetization on the economy and society of India was not the same as any of these countries. The idea behind executing the policy of Demonetization in India was to curb the issue of black money circulating in the country. Due to the transform in currency, everybody had to account for the cash they had. Thus a lot of income became answerable. This give on to a large growth in tax. This welfare was however confined only to definite economic sectors. India had a mixed reaction. There were several positive impression as well as negative effects of Demonetization. Whenever a new policy is introduced in any country disregarding of the fact whether it is developed or not, it takes time to estimate its impact. Therefore it becomes very important to take into account not only the instant effect but the long-term collision of a decision taken by the government.
Demonetization is one of the historic steps taken by the Government of India so far. It was no less than a financial rebellion to curb corruption. However, it is a continuous operation that will be discuss by the government from time to time. Although there are definite challenges faced by the policy, the primary aim of Demonetization have been achieved. The loopholes of the policy can be rebuild but the national interest of Demonetization should be acclaimed.
Conclusion
The note ban has been implemented in India on the night of November 08, 2016. The notes are now of the size of Rs. 500 and Rs. 2000 denominations. It is expected that banknotes will become more difficult for criminals to hoard and use for illegal activities. When the notes are withdrawn from circulation, the government is looking at becoming cleaner and more transparent.
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