Source: News Bharati English01 Jan 2017 14:20:37
According to its own admission, Zimbabwe was experiencing inflation of 231 million percent in 2008. What continued to be a long story of inaction on black money and corruption for many years, the Zimbabwe currency lost its value to the extent that trillion dollar notes would not buy a bus ticket in Zimbabwe seven years ago.
Every developed or developing country has gone through the demonetization route somewhere in the history. in 1969 denominations of US currency over $100 were declared obsolete by executive order of President Nixon, partly due to concerns about their use in organized crime. In the year 1991, Mikhail Gorbachev Government banned the currency note of Ruble 50 and 100 in Soviet Union to end black money in the country. In 1982, government of Ghana demonetized currency notes of Cedi 50 to control black money in the country. But after this people lost their faith from the economy policies of the country, and after few days, when time period of exchanging notes ended then crores of money were found on roads.
As compared to other countries Modi had prepared well in one crucial area. The number of people in formal banking sector incresed dramatically in last two years. Any other preparation would have lead towards leaking the information, defeating the very purpose of demonetization. The year end message of Modi should be seen in the light that it is yet too early to reap the benefits of this exercise.