Problems and Impact of Demonetization on Indian Economy

Abstract

Demonetization means that Reserve Bank of India has withdrawn the old Rs 500 and Rs 1000 notes as an official mode of payment. Demonetization is the act of stripping a currency unit as legal step. On 8th November from Midnight, the Government of India declared that the five hundred and one thousand rupee notes will no longer be legal tender. RBI will issue Two thousand rupee notes and new notes of Five hundred rupees which will be positioned in circulation from 10th November 2016. Notes of one hundred, fifty, twenty, ten, five, two and one rupee will remain legal tender and will remain unaffected by this decision. This gauge has been taken by the PM in order to resolution against corruption, black money and counterfeit notes.. Demonetization is one of the big steps initiated by Government in addressing the various issues like black money, counterfeit currency, corruption, terrorism etc. This paper focus on the problems due to Demonetization and impacts on the citizens of India and the economy.