Understanding Demonetization in India: A Deft Stroke of Economic Policy

This book examines the very concept, history, critique, and impact on the overall economy and black money, the move toward less-cash economy and digitalization, government–RBI relations, along with an assessment of two years of demonetization.

Demonetization has created a severe macroeconomic shock. The measure was humungous in scale and led to a sharp contraction in money supply for a short period. Although demonetization’s proponents have contended that it would cleanse the economy of black money and make transactions more formal and digital, its implementation certainly could have been better. The effects of demonetization on the Indian economy are debatable and will vary by sector. Its effectiveness will be talked about and studied by economists and policy makers for decades to come.

Demonetization has made only a minor dent in the GDP. It has helped to bring more people into the tax net and has reduced the size of the informal economy. With the increased use of digital payments, economic transactions become recorded. This book examines the very concept, history, critique, and impact on the overall economy and black money, the move toward less-cash economy and digitalization, government–RBI relations, along with an assessment of two years of demonetization. It would be prudent for the government to focus more on proper institutional reforms to address the issues originating from demonetization.

As an academician, Shrawan Kumar Singh has experience in teaching, research, and writing that spans over five-and-a-half decades. Having served at the University of Delhi, Banaras Hindu University (BHU), and Ranchi University, he retired from IGNOU, as professor and director of School of Social Sciences. His field of interest is Indian economic policy, business environment, and international business. Shrawan has a number of publications to his credit in the form of books, articles, and papers in various journals. He has been a member of academic bodies such as Academic Council and Board of Courses of Studies as well as professional bodies.