Okay, so, apart from the entire thing being dragged around by the international press, and Indian netizens, apart from countless stories of discomfort, there are afew things that stand out, which would paint the entire demonetization move in a bad light nonetheless. I'm no expert, and I'm recalling most of what I've read. Here goes:
1. Promises Promises: The PM unveiled the scheme abruptly (no woes here), promising people discomfort for a week... Then two weeks... Then a month... And then literally six months. You can see how things slipped out of controls as the initial "discomfort deadline" was a mere week.
2. Impeccable Planning: The new Rs 2000 note was not made to-size with the current ATM standards. As a result, the entire nation's ATM machines had to be modified. That is so big a blunder, it felt like I was reading The Onion when I read that one.
3. The Verdict: This one was the real eye opener. I was sympathetic to the entire humdrum, the months of inconvenience caused to everyone. (Full disclosure, I was not in India during the time. IMO, I can still have an opinion on the matter). But if it really did solve some parts of the black money problem, some good would have come out of it.
In the annual RBI report, it was mentioned that ~99% of the currency flowing in the form of Rs 500, Rs 1000 notes was returned back to the banks. This implies that 99% of the currency is now legal, white money. That less than 1% of the currency was unaccounted for, and that's the money gained by the RBI since those notes are now rendered invalid. Source: http://www.thehindu.com/business/Economy/only-12-of-demoneti...
In this light then, I can't help but think of the entire process to be shaky.
I think the government/RBI were fully aware of the period of discomfort.
Without incurring additional debt, the RBI could print only so much new currency as equal to the amount of old currency returned. This was the main reason for the crash crunch for the new currency, the ATMs being dry. Somehow nobody communicated this to the people.
Now they may have underestimated the logistical issues to verify how much currency was returned.
1. Promises Promises: The PM unveiled the scheme abruptly (no woes here), promising people discomfort for a week... Then two weeks... Then a month... And then literally six months. You can see how things slipped out of controls as the initial "discomfort deadline" was a mere week.
2. Impeccable Planning: The new Rs 2000 note was not made to-size with the current ATM standards. As a result, the entire nation's ATM machines had to be modified. That is so big a blunder, it felt like I was reading The Onion when I read that one.
3. The Verdict: This one was the real eye opener. I was sympathetic to the entire humdrum, the months of inconvenience caused to everyone. (Full disclosure, I was not in India during the time. IMO, I can still have an opinion on the matter). But if it really did solve some parts of the black money problem, some good would have come out of it. In the annual RBI report, it was mentioned that ~99% of the currency flowing in the form of Rs 500, Rs 1000 notes was returned back to the banks. This implies that 99% of the currency is now legal, white money. That less than 1% of the currency was unaccounted for, and that's the money gained by the RBI since those notes are now rendered invalid. Source: http://www.thehindu.com/business/Economy/only-12-of-demoneti...
In this light then, I can't help but think of the entire process to be shaky.
Edit: The link was an AMP link. Sorry about that.