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Modi's announcement on banning 500 and 1000 currency notes. How would it affect economy?
How did the demonetization affect the GDP of India?
According to the Reserve Bank of India, the demonetization resulted in a decline in GDP growth from 7.9% in Q2 of 2016-17 to 6.1% in Q4 of 2016-17. However, the government claims that the move has had long-term benefits for the economy, such as reducing tax evasion, increasing the formalization of the economy, and expanding the tax base.