'Modi's demonetisation fails, new notes now being used for corruption'

Here's why


News Desk December 15, 2016
Narendra Modi. PHOTO: REUTERS

Indian Prime Minister Narendra Modi’s demonetisation, a move to crackdown corruption has seemingly failed, with influential people apparently finding ways to exchange the old denominations with the new ones, without being noticed and accounted for.

The massive move of invalidation of all high denomination currency notes was taken to keep a check on tax evaders. However, it came at the expense of millions of poor and middle-class people who suffered while languishing at the ATM for cash.

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Officials thought the corrupt, who had a large amount of unaccounted cash, might just have to face the losses or pay for the penalties. But that was not the case, reported NDTV.

In just two states alone, India's Income Tax department recovered INR202,200,000 (roughly $3 million) in new 2,000 notes, according to ANI News. In those two states, Karnataka and Goa, the department said it had registered a total of 36 cases and recovered unaccounted-for assets - mostly in cash, jewellery and gold - in excess of INR10 billion (roughly $150 million).

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The question remains: did the government know that such loopholes would stay there before it moved to implement the invalidation of banknotes?

Meanwhile, reporter pretending to be businessman approached high-profile politicians and made deal of exchanging the old notes with the new ones with 30-40% share in it.

On December 6, a politician from Modi’s party was detained from West Bengal with INR3.3 million in new notes.

Besides politicians, bank employees have also been implicated in such laundering designs.

The new policy has but given ways to new ways of corruption while the poor suffer standing in the long queues to get the cash for daily expenditures.

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