PM Narendra Modi's sudden announcement of currency demonetisation came as a shock in many quarters, save some, who knew about the move and were part of the planning and execution.
There weren't many, though, who could take pride in being a part of it since the PM ensured that there was no scope of leakages. Call it his foresightedness, but the strategy worked.
Here's a timeline of how the story unfolded:
Nov 7: The heads of currency management sections in all banks received a confidential communication from the Reserve Bank of India, ordering them to be present at the headquarters.
Nov 8 (morning): They were handed over a double-decked currency chest the next morning, which contained the new currency denominations of Rs 2,000. The process was done in secrecy and it was ensured that those involved did not speak to anyone. They were further instructed to open the chest only after they received a nod from the RBI.
Nov 8 (evening): Bank officials received the green signal after the government went public with its idea to demonetize the Rs 500 and Rs 1,000 notes to curb the black money issue. To the surprise of the officials, there were new denominations of Rs 500 too, apart from the Rs 2,000 notes.
The managing director of a state-owned bank, under conditions of anonimity said, "We were called for a 7PM meeting (with RBI). For an hour, we chatted about this and that including S4A (Scheme for Sustainable Structuring of Stressed Assets), till at 8pm they switched on the TV and told us to listen to the PM's speech."
The official further added, "The news about the printing of Rs 2,000 currency notes leaked from the printing press in Hyderabad sometime back. But still no one was able to make the connection that India is going to go ahead with demonetisation."
While there are reports of the secret process going on for 6 months, officials in the financial sector are now connecting the dots. The hints that the RBI threw every now and then and the turn of events, all stood in sync with the process and the pre-requisite measures required for its successful execution.
RBI throws hints
Officials from the finance sector divulge that they could not figure out the reason behind RBI's warning about a sharp drop in the circulation of Rs 100 currency notes and counterfeits.
However, things took a dramatic turn when the agency directed banks to dispense more Rs 100 notes through ATMs within the next fortnight, claiming it was following up on an earlier request in May. That was November 2.
Earlier on October 27, the central bank issued a warning about fake currencies on its website. It directed all banks to put core areas under CCTV surveillance and ensure that cash receipts in the denominations of Rs 100 and above are not put into re-circulation without the notes being machine processed for authenticity.
Inside reports suggest that close to 3.5 billion pieces of Rs 2,000 currency notes were ordered for print, which is half of the 6.3 billion pieces of the Rs1,000 denomination that were in circulation three months ago.
[Read: What is Currency Demonetization?]
While that compensated (with certain drawbacks) for the Rs 1,000 denominations being pulled out of the markets, the government hit a setback as far as Rs 500 notes were concerned. Only a few million have been printed as compared to the 15.7 billion notes in circulation earlier.
For a move that is yet to show results when it comes to India's correctional gains, demonetisation is indeed a novel beginning.