Report card: Few hits and many misses of demonetisation after two years

The economy took a sharp knock from the cash crunch

India’s shock move to ban high-denomination currency notes almost two years ago caused much hardship, with limited benefits.

As the dust settles on the demonetization episode, the data show it didn’t weed out black money or cash gained through illegal means, which was a key objective of Prime Minister Narendra Modi’s plan. On the plus side, there’s been some widening in the country’s dismal tax base, an increase in digital payments and a drop in fake notes.

Modi invalidated 86 per cent of India’s currency in November 2016 in the hope that people who had stashed away illegal cash wouldn’t