This thesis purpose has been to investigate how the demonetisation in India has affected the political participation and the rural identity in a rural part of Karnataka. The demonetisation in this thesis has been connected to globalisation and show how the globalisation expresses on the rural locality. This has been done by a field study in a rural part of Karnataka that contained direct observations and six focus-group interviews that has been analysed with qualitative methodology. The rural identity has been operationalised to three indicators; caste-identity, family and gender-identity and political-identity. Our results shows that the rural identity has been somewhat affected by the demonetisation and globalisation. The political participation has not been affected. However there are tendencies that the demonetisation might transform the political participation in the future. Our findings also suggest that the urban have moved further away from the rural towards the global due to the demonetisation. Due to the increased distance between the rural and urban, the rural identity has become more independent.