PM Narendra Modi’s much hyped demonetistation move against black money and corruption has been dealt a severe blow as almost 97% of the banned currency has been accounted for and deposited in banks.  

Indians have deposited currency bills for almost all the banned notes by the December 30 deadline, a Bloomberg report by Siddhartha Singh and Bibhudatta Pradhan states.

As of December 30, banks have received Rs 14.97 trillion in old currency, the report states.

Around Rs 5 trillion of the Rs 15.4 trillion rendered useless since demonetisation was announced on November 8, had been estimated by the government to be black money since it had not been declared.

“The prime minister had been ill advised and the government was not prepared to handle the situation. The government expectation has been belied,” said Nilakantha Rath, honorary fellow at the Indian School of Political Economy.

Although the serpentine queues outside banks and ATMs which were seen in the immediate aftermath of the demonetisation announcement have reduced, popular opinion remains divided over whether the move was warranted.

There are indications that India which is one of the world’s fastest growing economies could be hurt by the cash clampdown.

For the second straight month, the Nikkei India Services Purchasing Managers’ Index contracted in December, the report adds.