India Currency Shakeup: Rs 500 and Rs 1000 Notes Banned
The Central Government Makes Bold Move Against Counterfeit Money
Since the central government demonetized the Rs 500 and Rs 1000 notes last week, there have been nearly three-dozen deaths. 33 deaths were reported across the country that could be connected directly or indirectly to the demonetization move. Many of the deaths were reportedly caused by exhaustion from standing in long lines at ATMs and banks. There has been a report of suicide and even one murder.
Why would the central government even have attempted such a move, knowing how it would negatively affect and inconvenience its citizenry?
The Modi government is trying to fight corruption and terrorism, and this is part of the plan.
This ban will help to both slow the flow of counterfeit money and put a halt to terrorist activity. It is said that India has lost up to $344 billion in illicit outflows of money. This is money that’s hidden and not being taxed. Most terrorist organizations and counterfeiting schemes use cash in order for them to carry out their transactions. The outlawing of the Rs 500 and Rs 1000 notes makes it harder for such transactions to be done.
The Modi government claims the move will help the government to clean up the system and block illegal transactions that rely on cash and stop tax evasion. So now the only way for money to be changed is to come into a bank. Persons involved in illegal activity who have large amounts of these notes have only two options which are to bring the notes into a bank and have them changed or burn the piles they have.
If they choose the first option it will be really difficult for them to get their money changed in a bank. Come into the bank with too much money and they risk being asked the source of the cash.
The ban on the notes is causing many hardships among the people of India as they work to adjust to this change. Right now it’s very unclear the level of impact that the ban will have on the economy. Overall, the ban is expected to impact business and most of the financial institutions at some level. All of this is expected to speed up the move in India from cash transactions.
This ban has been one of the biggest moves to target the black market in India. The crackdown has shocked counterfeiters, persons in the black market, hoarders and all people involved in corrupt and illegal cash activity. The move is one of the bravest by any government and there’s never been one like it before.
There are millions of dollars of fake money being smuggled across the borders of India to finance terrorism organizations and other illegal activity. The move is causing temporary problems to the people in the country with them not being able to use their money. It’s expected that the ban will cause lots of inconvenience to the honest people living in the country. The restrictions at the ATM machines and limits on withdrawals make it hard for people to get their hard earned money.
The modi government claims that this is to help with the cleaning up of the country. The people are hoping that it will. Counterfeiting is so rampant in the country and many will have to suffer because of it. The good side of all of this is that it will help to slow down some of the corruption and restore some type of order to the economy in the country.