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Five years of demonetisation: A quick look at how it affected the economy

Despite the government’s attempts to encourage payment digitization and discourage cash transactions, cash transactions in the country continue to rise gradually.

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Five years of demonetisation

By: Kritika Bobal

It was a normal day for everyone until 8:15 p.m. when Prime Minister Narendra Modi jolted the country by stripping a monetary unit of its legal tender status. PM Modi stated that Rs 500 and Rs 1,000 notes—86 percent of all currency notes in circulation in terms of value—would be pulled from the circulation and will no longer be accepted as legal tender after 12 a.m.

In compensation for the demonetised banknotes, it also announced the issuance of new 500 and 2,000 currency notes. This sudden announcement not only tremored the souls of the poor but also affected the middle-class people, mainly the businessmen.

The country’s unorganized sector, which includes small-scale companies and micro home units, collapsed overnight. Millions of such units that relied on real currency watched their banknotes degrade into mere scraps of paper overnight. To compensate for the loss incurred during the fiscal term, the organized sector was forced to lay off workers.

The objective of demonetisation was to eradicate black money, reduce the use of fake notes, increasing digitization, and ease the transition of India’s non-formal sector into a formal sector. However, the idea backfired substantially in the days that followed, as persistent cash shortages disrupted people’s daily lives.

Five years of demonetization: A quick look at how it affected the economy

People who wanted to exchange their money had to wait in long queues, and numerous people died around the nation. The crisis continued, and individuals in misery waited for hours in front of banks, even after December 30, 2016, the final day the RBI allowed residents to deposit their old notes.

Despite fears of an economic disaster hovering over the country in recent years, the economy has managed to leapfrog in recent years, five years after the government declared demonetisation. Despite the government’s attempts to encourage payment digitization and discourage cash transactions, cash transactions in the country continue to rise gradually. Similarly, the country’s cash-to-GDP ratio fell from 12 percent as a result of demonetization but recovered in later years.

Read Also: Punjab CM: Petrol price cut by Rs 10, diesel by Rs 5

According to National Crime Records Bureau statistics, the number of reported instances for making Fake Indian Currency Notes increased 190.5 percent from 2019 to 2020, an 11.7 percent increase. Similarly, there was an 11.7 percent rise in occurrences of counterfeit cash notes in 2019 compared to 2018.

In Tamil Nadu, a 65-year-old visually impaired man has filed a petition with the Krishnagiri district collector’s office, requesting to exchange his old demonetized notes of Rs 500 and Rs 1,000, amounting to Rs. 65,000 in total. He stated that the money was his life savings, which he earned via begging.

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Parliament winter session: Government lists 15 bills, including Waqf bill

The session will kick off on November 25 and conclude on December 20.

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The government has listed five new ones and one to amend the contentious Waqf law out of 15 bills for the winter session of Parliament. The session will kick off on November 25 and conclude on December 20.

The government has introduced five new bills, including the Coastal Shipping Bill, 2024, which aims to promote coasting trade and increase the participation of Indian-flagged vessels owned and operated by Indian citizens for both national security and commercial purposes.

Another significant legislation that will be introduced by the government is the Indian Ports Bill, 2024. This bill is designed to implement measures for the conservation of ports, enhance security, and manage pollution, ensuring compliance with India’s international obligations and statutory requirements.

Additionally, the government plans to introduce the Merchant Shipping Bill, 2024, which aims to meet India’s obligations under maritime treaties and support the development of Indian shipping while ensuring the efficient operation of the Indian mercantile marine in a way that serves national interests.

Pending legislation includes the Waqf (Amendment) Bill, which is awaiting consideration and passage after the joint committee of both Houses submits its report to the Lok Sabha. The committee is expected to report by the end of the first week of the winter session.

Currently, there are eight bills, including the Waqf (Amendment) Bill and the Mussalman Wakf (Repeal) Bill, pending in the Lok Sabha, while two additional bills are in the Rajya Sabha.

Furthermore, the government has also listed the Punjab Courts (Amendment) Bill for introduction, consideration, and passage, which seeks to increase the pecuniary appellate jurisdiction of Delhi district courts from Rs 3 lakh to Rs 20 lakh.

The Merchant Shipping Bill, along with the Coastal Shipping Bill and the Indian Ports Bill, is slated for introduction and eventual passage.

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International Criminal Court issues arrest warrant against Israel PM Benjamin Netanyahu over war crimes

The court accused Prime Minister Netanyahu and Defence Minister Gallant of crimes against humanity, including murder, persecution, inhumane acts, and the war crime of starvation as a method of warfare.

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International Criminal Court issues arrest warrant against Israel PM Benjamin Netanyahu over war crimes

The International Criminal Court (ICC) today issued arrest warrants for Israeli Prime Minister Benjamin Netanyahu and former Defence Minister Yoav Gallant over alleged war crimes and crimes against humanity.

The court accused Prime Minister Netanyahu and Defence Minister Gallant of crimes against humanity, including murder, persecution, inhumane acts, and the war crime of starvation as a method of warfare. The leaders allegedly restricted essential supplies such as food, water, and medical aid to civilians in Gaza, resulting in severe humanitarian crises and deaths, including among children.

Last year in October, Israel had launched attacks on Gaza in retaliation for the surprise attack by Hamas. The Israel-Hamas war has led to the death of thousands of civilians, while lakhs have been displaced. The major infrastructures in Gaza, including hospitals and schools, were also destroyed as Israel vowed to wipe out Hamas.

The International Criminal Court stated that it found reasonable grounds to believe the accused intentionally targeted civilians and limited medical supplies, forcing unsafe medical procedures, which caused immense suffering. This ruling was based on the findings from at least October 8, 2023 until at least May 20, 2024.

The court remarked that it has assessed that there are reasonable grounds to believe that PM Netanyahu and Defence Minister Gallant bear criminal responsibility as civilian superiors for the war crime of intentionally directing attacks against the civilian population of Gaza.

Furthermore, it also noted that the lack of food, water, electricity and fuel, and medical supplies created conditions of life calculated to bring about the destruction of part of the civilian population in Gaza, leading to death of civilians, including children due to malnutrition and dehydration.

Additionally, the International Criminal Court dismissed two challenges by Israel against its jurisdiction in the situation in the State of Palestine.

Notably, Israel had contested the ICC’s jurisdiction, claiming it could not be exercised without Israel’s consent. Nonetheless, the Chamber ruled that the Court has jurisdiction based on Palestine’s territorial scope, including Gaza, the West Bank, and East Jerusalem. It further noted that Israel’s objections were premature, as jurisdictional challenges under the Rome Statute can only be made after an arrest warrant is issued.

Reportedly, Israel had also requested a fresh notification regarding the investigation, started in 2021. Denying the request, the court stated that Israel had earlier declined to request a deferral, making additional notifications unnecessary.

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Yogi Adityanath accords tax-free status to Sabarmati Report film in Uttar Pradesh

Earlier, Prime Minister Narendra Modi and Home Minister Amit Shah have also praised this film.

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Uttar Pradesh Chief Minister Yogi Adityanath on Thursday accorded a tax-free status to ‘The Sabarmati Report’ film, based on the train burning incident at Godhra in Gujarat in 2002, in the state.

The announcement was made after Chief Minister Adityanath attended the screening of Vikrant Massey and Raashii Khanna-starrer ‘The Sabarmati Report’ in Lucknow with the film’s cast.  

Speaking to reporters, actor Vikrant Massey thanked the Uttar Pradesh Chief Minister for making ‘The Sabarmati Report’ film tax-free in the state. “I want to thank Yogi Adityanath ji. This is an important film and I appeal to everyone to go and watch this film,” he said.

Chief Minister Adityanath along with many of his cabinet colleagues watched the film ‘The Sabarmati Report’ under a special screening at a cinema hall in the capital, said a spokesperson of the state government.

Several people associated with the film unit were also present on the occasion. Later the chief minister announced to make this film tax-free in UP.

The BJP-ruled states have been praising the makers of The Sabarmati Report, claiming the team has tried to bring out this truth in front of the people of the country through the film.

The saffron party is appealing to people to watch this film and try to get closer to the truth of Godhra.

Uttar Pradesh becomes the sixth BJP-ruled state after Haryana, Rajasthan, Chhattisgarh, Madhya Pradesh and Gujarat to declare lead actors Vikrant Massey and Raashii Khanna’s film tax-free.

Adityanath said along with identifying the faces of those who are conspiring against the country for political gains, there is also a need to expose them. The film team has discharged its responsibilities to expose the truth, he said, adding an attempt has been made to bring the real truth in front of the country in a big way through the film.

The Sabarmati Report is said to be based on the incident of setting fire to a train full of ‘karsevaks’ in Godhra on February 27, 2002, killing 90 devotees. After this incident, communal riots broke out in Gujarat. Earlier, Prime Minister Narendra Modi and Home Minister Amit Shah have also praised this film.

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