What are the positive and negative impacts of Demonetisation?

GDP Came Down GDP of India has slowed down after implementation of demonetisation move as small industries were finding it difficult to carry out business. Due to decrease in consumption, demand for products in domestic market sharply fell down. GDP also rallied downwards from 9.2 in January 2016 to 7 in December 2016.

How is demonetization affecting Indian economy?

the main object of demonetization is to reduce corruption and reduce black money and fake currency. The main conclusion is that demonetization is positively affect on some part of Indian economy and also negatively affecting to some part of Indian economy.

What is demonetisation in Indian economy?

Demonetisation is a move in which a government bans the notes or coins of a certain denomination. The honorable Prime Minister Narendra Modi announced demonetisation in India on November 8, 2016 where Rs 500 and Rs 1000 notes were withdrawn from circulation.

What is demonetization and its impact?

How did demonetisation help?

On the fourth anniversary of demonetisation, Prime Minister Narendra Modi on Sunday said the move helped in reducing black money, increase tax compliance and formalisation of the economy.

Why is demonetisation important?

Increased Savings – As a result of demonetization, people will tend to deposit their cash in the bank rather than at home. This will help them save more. Lower lending rates – With currency demonetization, money moves from people to banks and financial institutions. Thus, there is a better circulation of money.

Was demonetization a success?

– Demonetisation has made India a lesser cash-based economy. At the end of the financial year 2015-16, Rs. 16.41 lakh crore worth of notes were in circulation, registering a YoY growth of 14.51 per cent over 2014-15.

How does demonetization help India?

India saw a surge in digital transactions after demonetization that was also lowering traditional transactions. Digital transactions have significantly grown since 2017 in India. On the other hand, as per the RBI report, demonetisation has helped India become a lesser cash-based economy.