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Showing posts from November, 2016

Other Countries That Have Attempted Demonetisation In The Past....

India is not a stranger to demonetisation as Prime Minister Narendra Modi recently marked the third time in history that currency notes have been demonetised in India. However, the recent currency ban of Rs 500 and Rs 1000 notes is the biggest currency ban in India’s history, making more than 80 percent of hard cash in circulation effectively worthless. As the country adjusts to the new currency norms, here is a list of other countries that attempted demonetisation, sometimes with not so successful results. Soviet Union In January 1991 under the leadership of Mikhail Gorbachev the country withdrew 50 and 100 ruble notes from circulation in an attempt to remove black money and increase the currency value. The removed notes formed around one third of the total money in circulation. The large scale demonetisation was not successful and Gorbachev faced a coup merely months later in August, however the 1991 attempt led to a successful redenomination of the ruble in 1998 where 3 ze...

Demonetisation

Demonetization  is the act of stripping a currency unit of its status as legal tender.  Demonetization  is necessary whenever there is a change of national currency. The old unit of currency must be retired and replaced with a new currency unit.                                   Impacts of  on Indian Economy?                                                              Demonetization is a generations’ memorable experience and is going to be one of the economic events of our time. Its impact is felt by every Indian citizen. Demonetization affects the economy through the liquidity side. Its effect will be a telling one because nearly 86% of currency value in circulation was withdrawn without replacing bulk of it. As a result of ...