View: By a 99.3% verdict, demonetisation was a farce

Economy       Rs 13,000 crore – the amount of currency banks did not get back after demonetisation
       	        Mahua Venkatesh         29 August 2018

Economy Rs 13,000 crore – the amount of currency banks did not get back after demonetisation Mahua Venkatesh 29 August 2018

About Rs 15.21 lakh crore of the demonetised Rs 15.41 lakh crore in circulation have been returned to banks, says RBI.

RBI in its annual report for 2017-18 said counting the demonetised notes is over. Over 100 lives were lost.

After the midnight stroke by Prime Minister Narendra Modi, the invalid notes called specified bank notes, were allowed to be deposited in banks across the country with significant deposits coming under income tax scrutiny. For instance, parts of the Rs 10,000 crore could lie with money seized by law enforcement, cash still being held with district cooperative banks and in bank notes being held by citizens of Nepal and Bhutan.

"There are some small notes which are stuck in the whole process, which can come back". This year, it transferred Rs 500 billion to the government as dividend, compared with Rs 306.6 billion a year ago. "Lakhs of jobs were destroyed", he tweeted. On November 8, 2016, Prime Minister Narendra Modi announced that all Rs 500 and Rs 1000 notes, comprising 86% of the total value of the currency in circulation at that time, would no longer be recognised as legal tender.

Almost 99% of the ₹500 and ₹1000 that were demonetised on the night of November 8, 2016, have now returned to the banks, says the Reserve Bank of India (RBI) in its annual report, released on Wednesday. "Remember who had said that Rs 3 lakh crore will not come back and that will be a gain for the government!", he said.

Without elaborating further, Garg said that the government has achieved the targets it had set for the demonetisation drive, including checking black money, conterfeit currency and terror funding and encouraging digital transactions. Data presented in the RBI's annual report show that while only 638 pieces of fake Rs 2,000 notes were detected in 2016-17, it jumped up to 17,929 pieces (worth Rs 360 million approximately) in 2017-2018. "The entire trade sector functions on cash, a sizeable portion of which is black money".

Chidambaram said every rupee of the Rs 15.42 lakh crore, barring a small sum of Rs 13,000 crore, has come back to the RBI. Meanwhile, the central bank may soon come up with varnished notes to increase their lifespan, which would not only reduce replacement requirement but would also save the central bank from security printing expenditure. "According to the report", In the evolution of monetary aggregates, currency in circulation surpassed its pre-demonetisation level while credit growth revived to double digits from a historic low in the previous year".

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