Demonitising the Rs 500 and 1,000 notes was not an easy decision at all. Prime Minister Narendra Modi made the announcement on Tuesday in his address to the nation and this took everyone by surprise. Although it has caused a great deal of invconvinience to the people, in the long run this move is expected to clean the country of black money and fake currency.
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Who advised the PM and the Finance Minister to take such a decision. Anil Bokil, a Pune based think-tank made this suggestion. He suggested several measures and steps that could be taken to rid the nation of the menace that is black money and fake currency.
The PM, FM, RBI governor and financial advisor had decided six months back that serious measures should be taken in this regard. Two months back the decision was made. Prior to that Bokil had met with the Prime Minister and given 9 minutes to make his case. In the nine minute presentation, here is what he said:
- Ban notes of Rs 500, 1,000 and even 100
- All transactions must take place through banks with the help of cheques, demand draft and online
- Single baking system for revenue collection
- Except import duty, stop collection of money under 56 different taxes
He justified his suggestions by saying that the country's 78 per cent population spends only Rs 20 a day. Hence they do not require big currency notes. He also said that in India an average transaction of Rs 2.7 lakh crore is seen daily which accounts a to Rs 800 lakh crore per year. However only 20 per cent transactions out of this takes place through banks. The rest all takes place through cash which cannot be traced.
The PM was impressed and the ban was set in motion.