A Study on the Impact of Demonitization on Selected Sectors of the Economy

Abstract

"All cash is not black money, and all black money is not cash". On November 2016, the currency was demonetized by the present government through removal of 1000 and 500 rupee denomination currency in India. The old unit of currency must be removed and substituted with a new currency unit. The currency was demonetized first time in 1946 followed by second time in 1978. This is the bold step taken by the government, for the betterment of the economy and country. However the after effects of this act were in manifold. Effect of demonetization was adverse across all sectors, particularly on unorganised sector. However very few researches have been conducted and little is known on these sectors after the demonetization.

Hence this paper focuses on the effectsof demonetization in organized and unorganized sector in particular.This paper is based on secondary data collected from newspapers, magazines, research papers etc.  The paper points out that most of the unorganised sectors deal with hard cash for their day to day operations including their profit margin which is kept is kept as reserves in hard cash. This paved way for greater effect on this sector when compared with organised sector.