The demonetisation of high denomination notes in January 1978 took place when who was the Prime Minister of India?
- A.Indira Gandhi
- B.Morarji Desai
- C.Charan Singh
- D.Lal Bahadur Shastri
Correct answer
Explanation
The correct answer is B, Morarji Desai. The High Denomination Bank Notes (Demonetisation) Act was passed in January 1978, when the Janata Party government led by Morarji Desai was in office, and it withdrew the notes of one thousand, five thousand and ten thousand rupees that had been reintroduced in 1954. Option A, Indira Gandhi, had earlier declined a similar proposal, and her period is remembered for the nationalisation of banks in 1969 and the abolition of privy purses, so she is the most likely wrong answer. Option C, Charan Singh, became Prime Minister in 1979, after this Act. Option D, Lal Bahadur Shastri, held office from 1964 to 1966 and is remembered for the war of 1965 and the Tashkent agreement. The three demonetisations to remember are 1946 by ordinance, 1978 by this Act and 2016 by notification.
Read the full article: Indian Currency: Notes, Coins, Mints and Demonetisation
Practice Questions
View allUnder which section of the Reserve Bank of India Act, 1934 does the Reserve Bank have the sole right to issue banknotes?
- A.Section 17
- B.Section 22
- C.Section 42
- D.Section 49
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Section 22 of the Reserve Bank of India Act, 1934 confers on the Reserve Bank the sole right to issue banknotes in India, and the Issue Department of the Bank keeps this function separate from its banking business.
Read the full explanation →Which currency note in India is issued by the Government of India and not by the Reserve Bank of India?
- A.One rupee note
- B.Two rupee note
- C.Five rupee note
- D.Ten rupee note
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The one rupee note is issued by the Government of India under the Coinage Act and carries the signature of the Finance Secretary, while every other denomination is a banknote issued by the Reserve Bank under Section 22 of its Act and carries the signature of the Governor.
Read the full explanation →What is the highest denomination of banknote that can be issued under the Reserve Bank of India Act, 1934 without amending it?
- A.Rupees two thousand
- B.Rupees five thousand
- C.Rupees ten thousand
- D.Rupees one lakh
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Section 24 of the Reserve Bank of India Act, 1934 permits banknotes of denominations up to ten thousand rupees, so a note of a higher value would need an amendment of the Act by Parliament.
Read the full explanation →Since which year has the note issue of the Reserve Bank of India been governed by the Minimum Reserve System?
- A.1935
- B.1949
- C.1956
- D.1969
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An amendment of the Reserve Bank of India Act in 1956 replaced the proportional reserve system with the Minimum Reserve System, under which the Bank must hold assets worth two hundred crore rupees against the note issue, of which gold must be not less than one hundred fifteen crore rupees…
Read the full explanation →A star below the year of minting on an Indian coin indicates which mint?
- A.Mumbai
- B.Hyderabad
- C.Noida
- D.Kolkata
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The mint of an Indian coin can be read from the small mark placed below the year of minting, and a five-pointed star stands for the Hyderabad mint.
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