The centre’s move to withdraw Rs 500 and Rs 1,000 currency notes in circulation on Tuesday at such short notice may have come as a surprise, but it’s not the first time the government has demonetized banknotes.
Withdrawal of high-denomination notes is a radical measure the government normally resorts to in an attempt to counter forgery.
It has been done at least twice in India’s history. This time, the attempt is to crack down on black money.
In January 1946, Rs 1,000 and Rs 10,000 banknotes were withdrawn. In 1954, Rs 1,000, Rs 5,000 and Rs 10,000 notes were reintroduced and were again demonetized in January 1978.
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