Indian Economy Case Study

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THE IMPACT OF DEMONETIZATION ON THE COMMON MAN G.E.B Jeevitha M.Kavitha D.Sharmila I –C K.C.S.Kasi Nadar College of Arts & Science

ABSTRACT: The Indian Economy is a $2 trillion worth one and considered as a growth engine of Asia. It is one of the economies that grew more than 7% in recent years. The industry as well as the services sector has been growing in phenomenon way in recent years, especially in service sector India has achieved a rare destination of Global Software Exporter. Despite of these achievements, India has been marred by corruption, execution deficiencies, lack of efficiency leaders and inefficient political system. Due to these flaws, a group of Indians representing less than 2-3%
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India’s GDP is $2,000 billion (Rs 125 lakh crore) and estimated parallel economy is 23 percent, which makes it about Rs 28 lakh crore. A large percentage of this amount is divided in real estate, gold, and cash. Real estate accounts for more than 50 percent and the rest 50 percent is equally divided between cash and gold. Around 68 percent of that cash is kept in denominations of Rs 500 and Rs 1,000 notes. A back-of-the-envelope calculation shows that Rs 3 lakh crore or $45 billion will flow into India’s white economy, which is equivalent to GDP of more than 100…show more content…
People with large amount of black money are using unscrupulous means to convert it into legitimate currency
3. A taxpayer has to stand in queues to withdraw his hard-earned money.
4. Online companies are having the last laugh as most of the white income class is resorting to online.
5. Small/medium sized business relying on cash transactions are seeing a total demand collapse.
6. Gem and Jewelry business will be hard hit.
7. Real estate prices will fall and the transactions volume will drop.
8. Second-hand car market will crash badly.
9. CAs will be having a time of their lives.
10. Banks will be having a tough time. They wiwill be flooded with cash
11. Political impact
12. All parties will join hands to paint the demonetisation scheme as a big scam.
13. Normal life may be impacted because of demonstrations.
14. BJP may do reasonably well in Punjab and UP elections.
15. No cash doles out in elections. Whole electioneering will change forever
16. Social impact
17. Low-income people have been impacted as their payments are delayed.
18. Some people may commit suicide.
19. Cashiers and bankers will get due respect in society.
20. Marriages to become cheap. Death of dowry.
21. All medicines in white money.
22. Big blow to gambling.
23. Death of drug mafia and terror

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