Demonetisation drive that cost India 1.5m jobs fails to uncover ‘black money’

Costly banknote recall did not flush out untaxed wealth, as PM Narendra Modi had promised

More than 99% of the currency that India declared void in a surprise announcement in 2016 was returned to the country’s banks in subsequent weeks, according to a Reserve Bank of India (RBI) report.

The figures suggest prime minister Narendra Modi’s demonetisation policy, which likely wiped at least 1% from the country’s GDP and cost at least 1.5m jobs, failed to wipe significant hordes of unaccounted wealth from the Indian economy — a key rationale for the move.

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