When on November 8, 2016, Prime Minister Narendra Modi announced a ban on high-value notes of Rs 500 and Rs 1,000 from the India economy, the percentage of small notes was merely 14%. But it was the risk worth taken — post demonetisation, small notes have made it big. The percentage of small denomination notes in the circulation has gone up to 26% post demonetisation, an annual report of the Reserve Bank of India showed.
According to the report, the percentage of small denomination notes, which was 14% of the total notes in circulation in the financial year 2015-2016, has gone up to 26% in the financial year 2016-2017. Nearly 86% of the high-denomination currency of Rs 500 and Rs 1,000 was demonetised last year, and new notes of Rs 500 and Rs 2,000 were infused in the system, which now stands at 74%.
Last year, Prime Minister Narendra Modi, in a televised nationwide address, announced to ban high-denomination notes of Rs 500 and Rs 1,000, and announced new notes of Rs 500 and Rs 2,000. The public was given 53 days to deposit or exchange old notes. Then, terrorism, corruption and black money were at the centre of Prime Minister’s decision to ban high-value notes.
“To break the grip of corruption and black money, we have decided that the 500 rupee and 1,000 rupee currency notes presently in use will no longer be legal tender from midnight tonight, that is 8th November 2016. This means that these notes will not be acceptable for transactions from midnight onwards. The 500 and 1,000 rupee notes hoarded by anti-national and anti-social elements will become just worthless pieces of paper,” the Prime Minister had said.
The government and the opposition have locked horns over demonetisation. While the opposition says that demonetisation was a “legalised loot”, which helped to turn black money into white, the government says it was a move to push for the cashless economy and subsequently bringing down the tax evasion. On the first anniversary of demonetisation, BJP will observe the day as anti-black money day, while the Congress will mark the day as black day.