Six Months After India Currency Ban, Poor Still Feel Effects
Six months after India's fast-growing economy was disrupted by the government's surprising move to scrap 86 percent of the country's currency, growth is back on track in most sectors and stock markets are surging. But many poor people still scramble to find work as the country's vast informal sector continues to struggle.
Growth last year is estimated to have been around 7 percent — less than the 7.9 percent recorded in the previous year, but not as severely dented as many economists had feared. Indian officials say these numbers proved that the drastic move meant to flush out untaxed money prove the government was right.
Many indicators support that. Automobile sales have jumped in recent months as shoppers again open their purses.
Projections that the economy is going to register stronger growth has led stock markets to hit a record high in the past week.
Economists say most sectors of the economy are back to normal except those that depend heavily on cash transactions, such as real estate.
However, while it is largely business as usual for the middle class and formal sectors, economists say the impact on tens of millions of people who depend on the informal sector — hawkers, vegetable sellers and laborers in cities and small farmers in remote villages — has been much harder. India's informal sector accounts for 40 percent of gross domestic product but employs as much as 75 percent of the country's workforce.
Despondent laborers wait for work at a busy junction in Gurugram near New Delhi. Demand for labor has dipped as work at many construction sites slows down.
