OPINION

How India can win from big cash bust

News, Mihir Sharma, Published on 09/11/2017

» Almost exactly one year ago, Indian Prime Minister Narendra Modi went on national television to announce that, in a few hours, existing 500- and 1,000-rupee notes (255 and 510 baht) would no longer be legal tender. This came as a complete shock to most; the weeks and months that followed featured long queues at bank tellers as hapless Indians tried to exchange old notes for new, and at ATMs where they tried to withdraw enough cash to keep going. The sudden drought of cash made it increasingly difficult for small- and -medium enterprises to operate, as they relied on piles of cash for working capital. Many estimated that economic growth would slow as a consequence and events seem to have borne out this point of view.