Prime Minister of India Narendra Modi announced the demonetization in an unscheduled live televised address at 8 pm on 8 November 2016. In the announcement, Modi declared that use of all Rs 500 and Rs 1000 banknotes of the Mahatma Gandhi Series would be invalid past midnight, and announced the issuance of new Rs 500 and Rs 2000 banknotes of the Mahatma Gandhi New Series in exchange for the old banknotes. The government claimed that the action would curtail the shadow economy, fake currency, block money, inflation, interest rate and crack down on the use of illicit and counterfeit cash to fund illegal activity and terrorism. This paper wants study the sudden nature of the announcement and the prolonged cash shortages in the weeks that followed created significant disruption throughout the economy, threatening on economic output, banking transactions, job opportunities etc. and this move of the central government called as ‘surgical strike on block money’ will be helpful for less cash and cashless economy in future days of India.
KEY WORDS: Demonetization, Reasons, Implications, Stock Exchanges, Banking Sector
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