RBI warned of demonetisation impact on Indian economy, no effect on black money
RBI had met just two-and-a-half hours before PM Narendra Modi announced demonetisation on 8 November 2016
The government has always maintained that demonetisation did not have much impact on India's GDP growth
New Delhi: The board of the Reserve Bank of India (RBI), which included the present governor Shaktikanta Das as a director, had warned of short-term negative impact of demonetisation on Indian economy and observed that the unprecedented move will not have any material impact on tackling black money.
The board, according to minutes of a meeting disclosed by RBI in an RTI reply, had met just two-and-a-half hours before Prime Minister Narendra Modi announced the demonetisation decision on 8 November 2016.
Curbing black money was one of the prime objectives of the shock move to junk old ?500 and 1,000 currency notes, which saw 86% of cash by value going out of circulation.
The minutes of the crucial board meeting, which approved the government's request for demonetisation, recorded the presence of then RBI governor Urjit Patel and the then economic affairs secretary Shaktikanta Das. Others at the board meeting included the then financial services secretary Anjuli Chib Duggal, and RBI deputy governors R. Gandhi and S.S. Mundra.
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