The end of India's economic liberalization

Narendra Modi is trying to save India's economy. Instead, he's wrecking it.

A street vender checks the authenticity of a rupee.
(Image credit: AP Photo/Aijaz Rahi, File)

Indian Prime Minister Narendra Modi stunned his country earlier this month when, out of the blue, he declared 85 percent of the nation's currency notes null and void.

India's two highest rupee notes — Rs. 500 ($7.50) and Rs. 1,000 ($15) — will no longer be legal tender, and will be replaced with redesigned Rs. 500 notes and new Rs. 2,000 bills. Indians can swap a relatively small number of old bills for new ones by the end of the year, but only at designated banks and with proof of ID. Anyone trying to swap large sums of cash that they can't legally account for will be subject to investigation and legal action.

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