Business Mantra News
Though the Government’s move of 8th November, 2016 of demonetizing 500 & 1000 rupees notes, has long term good effects like weeding out black money, counterfeit currency and bringing the unaccounted money in banking channel yet has put Indian Economy on stand still as of now.
Immediate announcement took out 86% of the value of currency out of economic channel and became illegal tender. The money markets came to a standstill immediately after this announcement. Businesses were affected, production stopped, movement of stocks from godowns to retail outlets got struck inspite of the government’s arrangements. People having functions like marriages and other ceremonies felt the heat of shortage of immediate cash. Daily wage earners could not find work the very next day. In the rural areas where maximum population solely depending on cash was badly affected.
It is still a hard fact that 40% of Indian Public is still not having Bank accounts. So these people have option of only exchanging the 500 & 1000 rupees notes from banks. The facility of exchange of Rs.4000/- of these notes have been provided to those persons not having banking facility and a withdrawal from Bank account for those having banking facility for Rs.20000/- per week. These facilities have since been revised to Rs.4500/ and Rs.24000/- respectively.
The immediate result was long serpentine like queues in front of Banks, petrol pumps, railway booking counters, air ticket counters were seen. ATMs went dry and because of technically not working due to denomination not fit to run. Staff in Banks has been working overtime from morning till late nights to cater the public even on Sundays and holidays.
But the facilities given by government are also being mis-utilised, people trying to over-smart as exchanging notes at different banks on multiple occasions. No big industrialists, netas etc. are seen in lines. Through unconfirmed sources, it is known that many persons have employed daily wage earners for standing in queues on behalf of others for exchange of old notes for new on payment of some amount. While others, are paying their trusted employees with advance salaries in old notes to clear their hoardings. Some are even clearing their old debts with old currency.
The aforesaid happening and hardships are temporary in nature and short-lived. As soon as the queues get reduced, misuse of facilities shall automatically be reduced. To build a strong nation with black-money free country such hardships always come in the way of building the nation.