On 8 November, Prime Minister Narendra Modi surprised investors and consumers by declaring that 86% of the nation’s money stock would no longer be a medium of exchange or store of value. In meetings in Mumbai and New Delhi recently, I learned that the move was intended to ferret out illegally garnered funds, and that the prime minister’s action took aim at the national pastime of avoiding income taxes. Large bills of Rs1,000 and Rs500 could only be exchanged at banks by providing documentation of how the wealth had been acquired.
Credit: livemint.com
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