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The Centre sprang a surprise on the 1.25 crore people of the country on Tuesday by demonetising ₹500 and ₹1,000 notes. But this is not the first time that this step has being taken.
In January 1946, the government withdrew ₹1,000 and ₹10,000 bank notes. However, in 1954, the higher denomination notes of ₹1,000, ₹5,000 and ₹10,000 were reintroduced.
Then, in January 1978, higher denomination notes of ₹1,000, ₹5,000 and ₹10,000 were again withdrawn during Janata Party rule to check black money circulation.
Now, in 2016, the NDA government has once again taken such a step to curb black money which it says is being used to finance terrorism.
However, has demonetisation of bank notes helped check the flow of black money in the economy, which has only increased manifold over the years? The jury’s still out.
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