The demonetization drive announced by the Government of India may be examined against stated objectives of reduction of black money, corruption, terror finance, counterfeit currency and above all against the strategy of making the Indian economy cashless. The analysis of demonetization may proceed along the lines of its impact in the short run and in the long run. Exploratory research has been used to examine technological, cultural and economic aspects of cashless economy and to suggest a roadmap for digitization of the Indian economy based on the share, trajectory and velocity of the shift towards the same. The making of a cashless economy requires a big push of policy initiative from the government and thereafter needs to proceed in stages post demonetization. The transition from being a paper currency based economy towards being a cashless economy is expected to aid GDP growth rate, investment and employment generation in the long run. Fundamentally it can alter the basis of taxation way from income and towards consumption.
Demonetization, cashless economy, digital transactions, consumption tax, GDP, growth rate, black money, black wealth, Reserve Bank of India, Government of India
