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Indians scramble to cash their savings before large notes become worthless

Indians scramble to cash their savings before large notes become worthless

Indians have lined up outside banks across the country today to cash their savings, after large bills were pulled out of circulation by the government in a bid to boost the economy and fight corruption.

Friday is the last day 500 and 1,000-rupee bank notes are regarded as legal tender in the country. On January 1, the notes will be worthless.

All the 500 and 1,000-rupee bank notes in the country have a combined worth of $256 billion and comprise 86 percent of Indian cash in circulation.

Indian Prime Minister Narendra Modi told local media on Thursday that his November 8 demonetization decree had succeeded in uncovering tax evasion and cracking down on graft.

“We took the demonetization decision not for some short-term windfall gain, but for a long-term structural transformation,” Modi was quoted as saying by local media.

Junior Finance Minister Santosh Gangwar said it was “a big movement to finish black money.”

The Indian administration believes by removing the large bills from the economy, billions of dollars’ worth of cash stashed in unaccounted wealth would be drawn out of hiding places and guided into the banking system, where it will be under supervision.

Analysts have voiced concern about the move raising issues such as lower economic growth, job losses and a fall in demand for goods.

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