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Note Ban - Useless & Bad: Raghuram Rajan
By: Tupaki Desk | 13 April 2018 9:14 AM GMT
Former RBI Governor Raghuram Rajan revealed he had cautioned Union Government that demonetisation wasn't a good idea.
Speaking at the Harvard Kennedy School in Cambridge, Raghuram Rajan condemned the version that RBI wasn't consulted before Government rolled out demonetisation on November 8th, 2016. 'Whereas, We never felt replacing 87.5 percent of the existing currency was a good idea. Note Ban wasn't planned properly. Any Economist would say if 87.5 percent of the currency is being scrapped, There should be similar amount of new currency to disburse. But, That's not been done in this case and hence negative impact on the economy. When all the demonetised money came back into the banking system, The purpose for which it's been implemented failed,' he opined.
Mr.Rajan told NDA Government assumed People having Black Money would apologise and pay taxes after note ban but that didn't happen. He pointed out Indians quickly find new ways to get things done.
Reacting on Government's claim that tax payments have increased, Raghuram Rajan said there should be strong evidence to trust those claims. He felt a new economic theory has to be found out to explain how note ban helped the economy.
Speaking at the Harvard Kennedy School in Cambridge, Raghuram Rajan condemned the version that RBI wasn't consulted before Government rolled out demonetisation on November 8th, 2016. 'Whereas, We never felt replacing 87.5 percent of the existing currency was a good idea. Note Ban wasn't planned properly. Any Economist would say if 87.5 percent of the currency is being scrapped, There should be similar amount of new currency to disburse. But, That's not been done in this case and hence negative impact on the economy. When all the demonetised money came back into the banking system, The purpose for which it's been implemented failed,' he opined.
Mr.Rajan told NDA Government assumed People having Black Money would apologise and pay taxes after note ban but that didn't happen. He pointed out Indians quickly find new ways to get things done.
Reacting on Government's claim that tax payments have increased, Raghuram Rajan said there should be strong evidence to trust those claims. He felt a new economic theory has to be found out to explain how note ban helped the economy.
