how the ban on 500 and 1000 notes will help Indian economy ?
How the ban on 500 and 1000 notes will help Indian Economy ? Recently Government of India has banned Rs 500 and Rs 1000 currency notes. This has sparked a nationwide debate that if this move is really going to boost the Indian Economy ? Here are some points which explains why and how this move of banning high denomination notes is going to help the Indian Economy –
- Indian economy is hurt max by bogus currency which inflows from the cross border by Pakistan. We must be aware of the news that ISI somehow managed to get the ink and currency paper used for printing our notes and was supplying exact notes cross border which was difficult to differentiate from original notes. Definately Pakistan will take ages to print these new format notes.
- All the unaccounted stacked black money mostly used by people in power is wiped out. These people don’t have the courage to get it exchanged or deposit in their account.
- As per recent RBI revelation only 86.4 % of Rs 500 and 1000 notes were in circulation. This means the rest of about 13.6 % of these high value notes are stacked and not used. This amounts to 14 trillion ruppes. Government of India is directly going to gain this much of huge money.
- The middlemen (agents) engaged in trades of household commodities use their cash power to reduce or shoot
the prices by stacking the items of common commodities like onion, pulses etc. They are stripped now of their power and we may expect the black marketing of these commodities and price shoot will reduce.
- This move will definitely cut-off the cash distribution to woo the public votes during recent election campaigns.