Page 21 - GK Class 04

16 India’s Demonetization

On November 8, 2016, the Prime Minister of India, Narendra Modi
announced the demonetization of all ` 500 and ` 1000 denomination

banknotes of the Mahatma Gandhi series. It was also announced that

the new ` 500 and ` 2000 bank notes would be introduced in exchange
for the old banknotes.

The new notes of ` 500 and ` 2000 look like the pictures given below.

SPECIMEN COPY SPECIMEN COPY

The new currency notes of ` 10, ` 20, ` 50 and ` 200 were also issued by the RBI.

SPECIMEN COPY SPECIMEN COPY SPECIMEN COPY SPECIMEN COPY

Reasons behind the demonetization in India are as follows –

Ø To tackle black money in the economy.
Ø To limit the use of money power in elections.

Ø The move is estimated to scoop out more than ` 5 lakh crore black money
from the economy.

Ø To lower the cash circulation in the country which is directly related to
corruption in our country.

Ø To eliminate fake currency and dodgy funds which have been used by terror
groups to fund terrorism in India.

This Corner

GST is an Indirect Tax which has replaced many Indirect Taxes in India. The Goods
and Service Tax act was passed in the Parliament on 29th March, 2017 and came
into effect on 1st July, 2017.

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