The Big Reverse
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17.‘The 1991 Monetary Reform in the Soviet Union’, Sputnik News dated 2 February 2011, https://sputniknews.com/business/20110202162419049/; ‘Wrestling for Rubles’, The New York Times dated 28 July 1993, https://www.nytimes.com/1993/07/28/world/wrestling-for-rubles. html?rref=collection%2 Ftimestopic%2FRussia&action=click& content Collection=world®ion=stream&module=stream_unit& version=search&content Placement=2&pgtype=collection; Pekka Sutela, ‘The Financial Crisis in Russia’, dated 1 December 1999, Bank of Finland Institute for Economies in Transition, http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.195.1209&rep=rep1&type= pdf; James M. Boughton, History of the International Monetary Fund Tearing Down Walls, Section III, Chapter 7, ‘From Rebirth to Crisis to Recovery’, IMF Publication, 1990-1999, https://www.imf.org/external/pubs/ft/history/2012/
18.‘Zaire Is in Turmoil After the Currency Collapses,’ The New York Times dated 12 December 1993, https://www.nytimes.com/1993/12/12/world/zaire-is-in-turmoil-after-the-currency-collapses.html; Hughes Leclercq, ‘How best to provide International Economic Aid in Zaire’, in Zaire Predicament and Prospects: A Report to the Minority Rights Group (USA) by J. C. Willame et al, The United States Institute of Peace, 1997.
19.Marcus Noland, Sherman Robinson and Tao Wang, ‘Famine in North Korea: Causes and Cures’, Economic Development and Cultural Change, Vol. 49, No. 4, pp. 741–67, The University of Chicago Press, July 2001; Marcus Noland, ‘North Korea’s Failed Currency Reform’, (PIIE) Peterson Institute for International Economics, https://piie.com/commentary/op-eds/north-koreas-failed-currency-reform; Scott Snyder, ‘North Korea Currency Reform: What Happened and What Will Happen To Its Economy?!’, https://asiafoundation.org/resources/pdfs/SnyderDPRKCurrency.pdf; ‘North Korea: Currency “Reform” Makes Citizens Poorer’, Time magazine dated 3 December 2009, http://content.time.com/time/world/article/0,8599,1945251,00.html
20.Hyperinflation was defined by Phillip Cagan, the author of The Monetary Dynamics of Hyperinflation as ‘a hyperinflationary episode that starts in the month that the monthly inflation rate exceeds 50 per cent, and ends when the monthly inflation rate drops below 50 per cent and stays that way for at least a year.’
21.Prof. Joseph Peden’s lecture ‘Inflation and the Fall of the Roman Empire’ at the Seminar on Money and Government, in Houston, Texas, on 27 October 1984.
22.Kallie Szczepanski, The Invention of Paper Money, ThoughtCo, 8 March 2017, https://www.thoughtco.com/the-invention-of-paper-money-195167
23.H.A. Scott Trask, ‘Inflation and the French Revolution: The Story of a Monetary Catastrophe’, 28 April 2004, https://mises.org/library/inflation-and-french-revolution-story-monetary-catastrophe; Irene Delage, The History of the Franc: The Key Moments, https://www.napoleon.org/en/history-of-the-two-empires/articles/a-history-of-the-franc-the-key-moments/
24.Nathan Lewis, ‘In Hyperinflation’s Aftermath, How Germany went back to Gold’, Forbes.com dated 9 June 2011, https://www.forbes.com/2011/06/09/germany-gold-standard.html#2baad50d5934
25.I had an unforgettable experience with respect to the old marks. I was the Chief Operating Officer of ABN AMRO Bank in India when the Euro was introduced. One day, I was approached by a customer with the request to unlock a locker in our Bada Bazaar branch in Kolkata. The locker had been sealed for many years and was registered in the name of his late grandfather. After due diligence and securing the necessary court approvals, the locker was opened. Old Weimar currency with a face value of millions of marks tumbled out! The customer was triumphant – his grandfather had told him there was a fortune in the locker, and he wished to claim its full value in Euros! It took a long while to explain to him that other than their historical value, these pieces of paper were worthless.
26.Adam Fergusson, When Money Dies: The Nightmare of Deficit Spending, Devaluation, and Hyperinflation in Weimar Germany, UK, Hachette, 2010.
27.Peter Z. Grossman, János Horváth, ‘The Dynamics of the Hungarian Hyperinflation, 1945-6: A New Perspective’, https://digitalcommons.butler.edu/cgi/viewcontent.cgi?article=1029&context=cob_papers; Brian Taylor, ‘The Worst Hyperinflations in History: Hungary’, https://www.globalfinancialdata.com/GFD/Blog/the-worst-hyperinflations-in-history-hungary
4 The Human Impact
1.‘Crowds Line Up at India’s Banks to Exchange Banned Rupee Notes’, The New York Times dated 10 November 2016, https://www.nytimes.com/2016/11/11/world/asia/india-rupee-ban-narendra-modi.html
2.‘Delhi: 48-year-old man beaten up for criticising Modi’s demonetisation drive’, India Today dated 19 December 2016, https://www.indiatoday.in/fyi/story/delhi-48-year-old-man-beaten-up-for-criticising-modis-decision-to-demonetise-358338-2016-12-19
3.Khadims are a community who have been traditional custodians at the shrine of Khwaja Moinuddin Chishti in Ajmer Rajasthan, helping pilgrims with prayers and offerings.
4.Pushkar is a prominent pilgrimage spot near Ajmer, famous for its Brahma temple and the renowned annual camel fair.
5.In 1990, riots and protests broke out against the Mandal commission report which recommended 49.5 per cent reservations in government jobs and public universities, on the basis of caste. The protests disrupted business nationwide, and eventually led to the fall of the V.P. Singh government.
6.In December 1992, the demolition of the Babri Masjid mosque in Ayodhya triggered riots across India, leading to disruption and closure of many businesses.
7.‘No official report on deaths due to demonetisation: Government’, The Economic Times dated 17 March 2017, https://economictimes.indiatimes.com/news/politics-and-nation/no-official-report-on-deaths-due-to-demonetisation-government/articleshow/57690438.cms
8.‘Demonetization effect: Labourers skipping meals to survive’, The Times of India dated 22 December 2016, https://timesofindia.indiatimes.com/city/ahmedabad/demonetization-effect-labourers-skipping-meals-to-survive/articleshow/56262990.cms
9.‘At Azadpur mandi, wealthy agents getting coolies to double up as cash mules to exchange old notes’, Business Standard dated 20 November 2016, https://www.business-standard.com/article/economy-policy/lack-of-money-choking-azadpur-mandi-116111900364_1.html
10.‘Farmers, daily wage laborers in Odisha badly hurt by demonetization’, Village Square dated 21 November 2016, https://www.villagesquare.in/2016/11/21/farmers-daily-wage-laborers-odisha-badly-hurt-demonetization/
11.According to data from Census 2011, and the socio-economic caste census.
12.‘Demonetisation chokes livelihoods of tribal people’, The Times of India dated 10 January 2017, https://timesofindia.indiatimes.com/city/kozhikode/demonetisation-chokes-livelihoods-of-tribal-people/articleshow/56436370.cms
13.‘#Notebandi Frontlines: In Tribal Areas, Low Literacy, Cellphone Use, Few ATMs’, India Spend dated 22 December 2016, http://www.indiaspend.com/cover-story/notebandi-frontlines-in-tribal-areas-low-literacy-cellphone-use-few-atms-25457
14.P. Sainath, author of Everybody Loves a Good Drought, is a noted journalist and the founder of People’s Archive of Rural India (PARI).
15.‘The Costs of Demonetisation: Brushed Off “Brush Nagari”; Difficult Times For Kirana Stores’, The Wire dated 16 January 2017 quoting People’s Archive of Rural India (PARI), https://thewire.in/uncategorised/costs-demonetisation-2
16.‘Demonetisation Has Seriously Hurt The Farmers And Daily Wage Workers Of Odisha’, Village Square dated 21 November 2016, https://www.huffingtonpost.in/village-square/demonetisation-has-seriously-hurt-the-farmers-and-daily-wage-wor_a_21610627/
17.‘Demonetisation Has Wrecked Farmers’, The Wire dated 28 November 2016, https://thewire.in/83072/demonetisation-has-wrecked-farmers/?fromNewsdog=1
18.‘At Delhi’s Azadpur Mandi, Lack of Money is Slowly Choking Business and Also Workers’, The Wire dated 18 November 2016, https://thewire.in/agriculture/azadpur-mandi-glimpse-agricultural-supply-chain-held-together-credit-goodwill-old-notes
19.‘Wholesale egg prices decline due to Demonetisation’, The Times of India dated 9 January 2017, https://t
imesofindia.indiatimes.com/city/aurangabad/wholesale-egg-prices-decline-due-to-demonetisation/articleshow/56408770.cms
20.‘Demonetisation effect: Poultry farmers badly hit, farmgate price falls by close to 40 per cent’, The Indian Express dated 4 December 2016, https://indianexpress.com/article/india/demonetisation-effect-maharashtra-poultry-farmers-badly-hit-farmgate-price-falls-by-close-to-40-per-cent-4409543/
21.‘Currency tsunami hits Kerala fisher village’, Village Square dated 28 November 2016, https://www.villagesquare.in/2016/11/28/currency-tsunami-hits-kerala-fisher-village/
22.‘In Gujarat, dairy farmers from milk cooperatives have not been paid in 50 days’, Scroll.in dated 4 January 2017, https://scroll.in/article/825730/in-gujarat-dairy-farmers-from-milk-cooperatives-have-not-been-paid-in-50-days
23.‘Demonetisation Effect: Dairy Farms Across Maharashtra Feeling The Pinch’, Mid-day dated 18 November 2016, https://www.mid-day.com/articles/demonetisation-effect-dairy-farms-maharashtra-milk-supply-cattle-currency-notes-news/17766180
24.‘Demonetisation effect: “Cash crunch”, Bengal tea garden closed’, The Indian Express dated 11 December 2016, https://indianexpress.com/article/india/demonetisation-effect-cash-crunch-bengal-tea-garden-closed-4421212/
25.‘Demonetization effect: Assam tea worker commits suicide citing lack of “Funds”’, NE Live dated 7 January 2017, https://www.nelive.in/assam/news/demonetization-effect-assam-tea-worker-commits-suicide-citing-lack-funds
26.‘Demonetisation hits tea production in south India’, The New Indian Express dated 11 February 2017, http://www.newindianexpress.com/business/2017/feb/08/demonetisation-hits-tea-production-in-south-india-1568178.html
27.‘How Demonetisation Has Hit Rishikesh’s Tourism Industry’, The Wire dated 19 January 2017, https://thewire.in/politics/demonetisation-tourism-rishikesh
28.‘#Notebandi Frontlines: Small Stores Struggle To Survive, But Many Support Modi’, India Spend dated 16 January 2017, http://www.indiaspend.com/cover-story/notebandi-frontlines-small-stores-struggle-to-survive-but-many-support-modi-17982
29.‘Note ban cuts strings of kite market’, The Times of India dated 13 January 2017, https://timesofindia.indiatimes.com/city/bhopal/note-ban-cuts-strings-of-kite-market/articleshow/56512074.cms
30.‘Two months after note ban, business severely affected at weekly markets in Delhi’, the Hindustan Times dated 8 January 2017, https://www.hindustantimes.com/delhi-news/two-months-after-note-ban-business-severely-affected-at-weekly-markets-in-delhi/story-2viVASox8ymup2kZjeNGkJ.html
31.‘Notebandi Frontlines: Farm To Loom, Textiles–Employer Of 25 Million–Totter’, India Spend dated 24 January 2017, http://www.indiaspend.com/cover-story/notebandi-frontlines-farm-to-loom-textiles-employer-of-25-million-totter-85517
32.‘Banarasi sari industry in trouble as traditional credit vanishes after note ban’, The Hindu dated 12 January 2017, http://www.thehindu.com/news/national/other-states/Banarasi-sari-industry-in-trouble-as-traditional-credit-vanishes-after-note-ban/article17024058.ece?homepage=true
33.‘Demonetisation: How India’s textile industry is tottering after note ban’, Business Standard dated 23 January 2017, https://www.business-standard.com/article/economy-policy/demonetisation-how-india-s-textile-industry-is-tottering-after-note-ban-117012300160_1.html
34.‘Textile Industry Affected Adversely by Demonetisation’, Perfectsourcing.net, January 2017, http://www.perfectsourcing.net/Demonetisation.html
35.‘Demonetisation impact: AIMO report says note ban caused 35% job loss, 50% dip in revenue’, Financial Express dated 9 January 2017, https://www.financialexpress.com/india-news/demonetization-impact-aimo-report-says-note-ban-caused-35-job-loss-50-dip-in-revenue/501424/
36.‘Demonetisation on a shoestring: How UP leather industry is hit by cash crunch’, The Indian Express dated 25 December 2016, https://indianexpress.com/article/india/demonetisation-on-a-shoestring-how-up-leather-industry-is-hit-by-cash-crunch-4443645/
37.‘Demonetisation takes the shine off Moradabad’s brass industry’, LiveMint dated 29 December 2016, https://www.livemint.com/Politics/zuecM5NyYZhmH0u7uuAj2I/Demonetisation-takes-the-shine-off-Moradabads-brass-industr.html
38.‘Demonetisation Hits Raipur’s Iron And Steel Traders Hard’, Bloomberg Quint dated 11 November 2016, https://www.bloombergquint.com/business/2016/11/11/demonetisation-hits-raipurs-iron-and-steel-traders-hard#gs.C7HrO2M
5 Impact on the Economy
1.A professionally-run, independent think tank with the largest integrated database on the Indian economy. It conducts the largest survey to estimate household incomes, patterns of spending and savings, and new investments.
2.‘Note ban to badly disrupt eco activity in short run: Moody’s’, The Times of India dated 25 November 2016, http://epaperbeta.timesofindia.com/Article.aspx?eid=31804&articlexml=Note-ban-to-badly-disrupt-eco-activity-in-25112016021033
3.Addressing the Rajya Sabha on 24 November 2016.
4.‘Anti-demonetisation experts stand exposed, says Bhagwati’, dated 17 March 2017, https://www.thehindubusinessline.com/economy/antidemonetisation-experts-stand-exposed-says-bhagwati/article9589666.ece
5.The Factor cost GDP figure is calculated by collecting data for the net change in value for each sector during a particular time period. The following eight industry sectors are considered: (1) Agriculture, Forestry and Fishing; (2) Mining and Quarrying; (3) Manufacturing; (4) Electricity, Gas and Water supply; (5) Construction; (6) Trade, Hotels, Transport and Communication; (7) Financing, Insurance, Real estate and Business services; (8) Community, Social and Personal services. The Expenditure at market prices method involves calculating the domestic expenditure on final goods and services during a particular time period. It is measured by aggregating the following elements: (1) Expenditure by Households and Individuals on Consumption of goods and services; (2) Expenditure by Government; (3) Net Investment by Companies and Businesses representing new Capital Formation; and (4) Net Exports (namely the total of Exports minus Imports). Further calculations are made to arrive at nominal GDP (using current market prices) and real GDP (adjusted for inflation), which allows for a comparison across time periods. Among the four numbers, the GDP at factor cost is the most commonly reported. The CSO releases GDP data on a quarterly basis – with a lag of two months from the last working day of the quarter. Annual GDP data is released on 31 May, two months after the financial year-end. Estimates of each set of figures are revised as more data becomes available – and each data point is often revised 2 to 3 times. See MOSPI website: http://www.mospi.gov.in/central-statistics-office-cso; Investopedia
6.GVA at basic prices = GDP at factor cost + Production Taxes – Production subsidies. To explain this in simple terms, GVA now includes what the government earns by way of indirect taxes such as sales tax and excise duty after deducting subsidies. Previously, Indian GDP did not include indirect taxes received by the Government.
7.NSS surveys that would be included were the enterprise survey (2010–11), employment-unemployment survey (2011–12), all-India debt and investment survey, situation assessment survey of farmers, and survey on land and livestock holdings (2013).
8.Anupam Prakash, Avdhesh Kumar Shukla, Anand Prakash Ekka and Kunal Priyadarshi, Mint Street Memo No 12 dated 1 May 2018, National Accounts Analysis Division, Department of Economic and Policy Research, RBI.
9.Page 12, RBI Annual Report, Para II.1.3 published in August 2017.
10.150 CSO Estimate of GDP dated 28 February 2018: India’s GVA at Constant Prices for 2016–17 = `112.48 lakh crore; for 2017–18 = `119.64 lakh crore, therefore one per cent for each year = `1.12 lakh crore + 1.19 lakh crore = `2.21 lakh crore.
11.‘Economic Slowdown Is Real, Not Just Technical: SBI Research’, Business World dated 19 September 2017, http://www.businessworld.in/article/Economic-Slowdown-Is-Real-Not-Just-Technical-SBI-Research/19-09-2017-126522/
12.Speaking at a rally in Agra on 22 November 2013, Narendra Modi said, ‘If BJP comes to power, it will pro
vide one crore jobs.’ See https://economictimes.indiatimes.com/news/politics-and-nation/one-crore-jobs-if-bjp-comes-to-power-narendra-modi/articleshow/26165012.cms
13.‘New jobs: The 70 lakh boast’, The Indian Express dated 12 September 2018, https://indianexpress.com/article/opinion/columns/new-jobs-market-employment-esic-nps-gpf-epfo-pension-provident-fund-5041737/; ‘Creating 75 lakh jobs impossible, simultaneous polls a jumla: Chidambaram’, Business Standard dated 30 January 2018, https://www.business-standard.com/article/news-ians/creating-75-lakh-jobs-impossible-simultaneous-polls-a-jumla-chidambaram-118013001711_1.html; ‘7 mn jobs in FY18? An “independent study” with government’s hand-holding’, Business Standard dated 18 February 2018, https://www.business-standard.com/article/economy-policy/7-mn-jobs-created-in-2017-18-niti-helped-ghosh-ghosh-access-epfo-data-118021501546_1.html; ‘Why the Claim of Seven Million Formal Jobs Created Annually Should Be Taken With a Pinch of Salt’, Praveen Chakravarty, The Wire dated 29 January 2018, https://thewire.in/business/seven-million-formal-jobs-created-annually-misplaced-debate-epfo-data-employment
14.On the basis of the report ‘Towards a Payroll Reporting in India’ by Soumya Kanti Ghosh, Group Chief Economic Advisor, State Bank of India, and Pulak Ghosh, Professor at IIM Bangalore, using Employees’ Provident Fund Organisation data.
15.‘Unemployment Rate in India: Nearly 31 million Indians are jobless’, The Times of India dated 6 March 2018, https://timesofindia.indiatimes.com/home/education/news/unemployment-rate-in-india-nearly-31-million-indians-are-jobless/articleshow/63182015.cms
16.https://data.worldbank.org
17.The India Labour and Employment Report (ILER) 2014, prepared by Institute for Human Development (IHD) and the Indian Society of Labour Economics, provides an overview of the labour and employment scenario in India during the last two decades after globalisation.