How soon will this flush of Indian currency impact the economy?

Whole demonetization scheme by Modi government was broadly seen as a political move, but ban on high-value currency might hail as a game-changer to check corruption and tax evasion.

Currency notes with denomination values of INR 500 (about $7.5) and INR 1000 (about $15) respectively discontinued from midnight of 08 November 2016 Source: EPA

The Special Investigation Team (SIT) on black money suggested the government to put a limit on cash holding and cash transactions. Also ask banks to report to the I-T department on large cash deposits. Government's intentions are to bring all citizen under taxation structure and familiar with banking system.

Currently, only 1% of India's population pays income tax. Will demonetisation change that, and herald a new era of a cashless economy in India?

Gautam Kapil explains.