In November 2016, in the immediate aftermath of demonetization, India’s vast and voluminous system of agricultural markets—a historically cash-driven enterprise—came to a grinding halt. In what is normally peak season for marketing the monsoon harvest and purchasing supplies for the winter planting, reports from across the country described delays in bringing goods to market, contracting demand, crashing prices, and market closures. Here was a peculiarly cruel irony even for those seasoned in agrarian uncertainty: a man-made liquidity crisis after a long-awaited spell of good rains.

And yet, agricultural markets are also incorrigibly dynamic. So in February 2017, when I visited Harda mandi, an agricultural market and my old field site in small-town central India, traders were overflowing with vivid accounts of the trading strategies, commission rates, cash and credit rotations, storage devices, temporal manipulations, and old and new transactional forms that had erupted and since dissolved—as tends to happen in times of acute shortage, fiscal flux, and regulatory improvisation (Humphrey 2002; Guyer 2004; Roitman 2005). All this was accompanied by the usual surplus of wicked jokes and astute political analysis, the stock-in-trade of mandi exchange.

It shouldn’t surprise us that the first response to India’s war on black money was a rush on gold (see Graeber 2011). As soon as the news hit, Indore’s famous jewelry market, an old den of speculation that has troubled colonial and postcolonial regulators alike (Birla 2009), came alive, with crowds thronging shops late into the night. “You should have been there,” the grain traders of Harda told me. “Gold prices shot up every five minutes. From twenty-eight thousand to thirty thousand, thirty-five, forty, forty-two, forty-five, fifty, even fifty-five! What a rush!” Even as business in bullion exploded overnight, transactions were kept below the high-value threshold and bills had to be backdated to circumvent the ban. “Some made long profits in those few hours,” a trader remarked, “but the game was short-lived”—income tax officers materialized early in the morning.

When the mandi officially reopened a fortnight after demonetization, traders who had routinely made cash payments to farmers on the spot shifted to checks or electronic bank transfers to settle transactions. As a result, cash-strapped farmers had to wait anxiously for payments to be credited to their accounts and even longer to be able to withdraw their money. At the same time, in rural and small-town markets, commodity exchange also became much more complex with multiple rates on offer depending on the mode and duration of payment. In other words, there were now different prices depending on whether farmers were offered immediate (old cash) or deferred (new cash and check) payments for their produce.

These kinds of transactions are not at all unusual in interlinked credit-and-commodity markets, allowing cash to be further deployed or rotated before accounts are settled. But now there were not only a range of rates for the same commodity depending on the type and timing of payment, there were also fluctuations in the value of the notes themselves: in the weeks up to the end of December, while the window to deposit old notes remained open, new daily conversion and commission rates for old and new notes opened as well, with cash as the prized commodity of the postharvest season.

The business of conversion had its cash cows (petrol stations, mandated to accept old notes, were quick to enter the recirculation game) and its so-called cash mules—market laborers dispatched to different banks to stand in line for note exchange. When it came to depositing cash, Harda’s traders used every commercial and familial account at their disposal (fifty, in one instance). Here, as elsewhere in India, such domestic deposits included old notes that emerged from the piggy banks of small children and the secret knots of housewives’ saris.

In the end, in something of an embarrassment for the government, the multifarious conversion schemes that ensued were so successful that nearly all (and perhaps even more than) the demonetized amount seems to have made it back into the banks. But grain traders in Harda, now preoccupied with the crash in the price of pulses (including lentils), knew better than to brag about bucking the system. The shadow of the income tax inspector, they anticipated, would bear down on all of them; even farmers, long exempt from paying taxes, had started receiving notices to explain hyperactivity in their bank transactions. Small-town agro-commercial capitalists in Madhya Pradesh observed that their own political currency was undergoing a kind of demonetization in an ascendant economic regime favoring large-scale corporate capital. With the ruling Bharatiya Janata Party poised to make further electoral gains, a trader remarked of his fellow citizens: “Just wait and see. They will hurl curses over notes, but shower [the prime minister] with votes.” How’s that for commodity exchange?


Birla, Ritu. 2009. Stages of Capital: Law, Culture, and Market Governance in Late Colonial India. Durham, N.C.: Duke University Press.

Graeber, David. 2011. Debt: The First Five Thousand Years. New York: Melville House.

Guyer, Jane I. 2004. Marginal Gains: Monetary Transactions in Atlantic Africa. Chicago: University of Chicago Press.

Humphrey, Caroline. 2002. The Unmaking of Soviet Life: Everyday Economies After Socialism. Ithaca, N.Y.: Cornell University Press.

Roitman, Janet. 2005. Fiscal Disobedience: An Anthropology of Economic Regulation in Central Africa. Princeton, N.J.: Princeton University Press.