Indian PM Announces High-Value Notes Demonetisation

In a sudden move that has taken everyone by surprise, Indian Prime Minister Narendra Modi has announced that currency denominations of Rs. 500 and Rs. 1000 would be not accepted as legal tender starting Nov. 9. He said that this was an essential move to crackdown on corruption, black money and terrorism in the country.

PM Modi made the announcement in an unscheduled televised address to the nation late night on Nov. 8. He said that the newly designed Rs 500 and Rs 2,000 currency notes would be released shortly as replacement. All other lower currency denominations remain legal.

In a statement, Modi said

To break the grip of corruption and black money, we have decided that the 500 rupee and 1,000 rupee currency notes presently in use will no longer be legal tender from midnight tonight, that is 8th November 2016. The 500 and 1,000 rupee notes hoarded by anti-national and anti-social elements will become just worthless pieces of paper.

NDTV

He highlighted that the problem of corruption had affected those who worked hard and were honest, creating inflationary pressures and impacting delivery of economic benefits to those who need it the most. Modi also said that counterfeit money was a significant source of funding for terrorism activities as evidenced by fake notes seized several times over the years. He also noted that black money was used extensively to influence elections.

Pointing out that while several steps taken so far to remove corruption and black money have yielded only limited success, it was time for decisive action to be taken.

In his 40-minute televised address, PM Modi emphasized that the interests of the common man would be fully protected. The existing notes can be deposited with banks and post offices over the next 50 days within specified limits. For immediate needs people can exchange their notes for new ones after showing a proof of identification. On humanitarian grounds several places like hospitals and railway stations have been exempted from the Nov.9 deadline. These institutions will accept the demonetized notes till Nov. 11.

Bank ATMs would be closed until Nov. 11 after which they will be stocked with the new notes. Bank offices were closed on Nov. 9 in order to allow the banks to prepare themselves for the ensuing logistical operations.

Acknowledging that there might be temporary hardship to everyone, PM Modi called upon the nation’s citizens of participate whole-heartedly in the battle against black money and corruption and cleanse the nation of these evils.

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