More than a month ago, on November 8th, in a nationally televised speech, Indian Prime Minister Modi announced that from that midnight onwards 85% of value of cash in circulation in India will become invalid. The two higher denomination currency notes of Rs 500 and Rs 1000 which were withdrawn from circulation formed the bulk of cash in use. Government gave time till December 30 to exchange or deposit old invalid notes, but put heavy restriction on the amount of withdrawal of new notes from Banks.
The stated reason for such a drastic move was to curb black money, eliminate counterfeit notes and to reduce terrorism. Looking back after a month it seems the move failed in all counts while putting ordinary people, especially the poor to severe hardships. Moreover it opened new avenues of corruption with involvement of bank and income tax officials.
Most economists were very critical of the move. Here are some excerpts of the criticisms.