Ahead of demonetisation’s first anniversary, Finance Minister Arun Jaitley spoke at length about the impact of demonetisation and the much-criticised Goods and Services Tax (GST) today. Participating in a session titled “India – Technology and Governance, the Indian Experience”, Arun Jaitley said that demonetisation is “structural reform” and every structural reform will have some consequences.
Quashing his predecessor P Chidambaram’s comment on demonetisation being a failure in the Indian economy, Jaitley said that every structural reform needs political courage to shoulder responsibility.” If a structural reform takes you a step back for a quarter ot two, but helps you in the longer run, then is it such a big price to pay?”, added Jaitley.
The Finance Minister said that demonetisation should not be seen as a move in isolation but in combination with the various steps that the Modi government has taken to ensure that India ultimately sees a “sea change” in how it spends its money. “A step like demonetisation and if you link it to various steps government has taken, I think we’ve succeeded in bringing to centre stage the issue of how financial transactions in a country like India ought to be carried out,” Jaitley said at the India Today Conclave Next 2017.
Hailing the fact that tax compliance has increased after note ban, Jaitley said that it was a way of life to not pay taxes in India before demonetisation, which has now changed. He also stressed at the fact that there has been a huge squeeze of money for terrorist post-demonetisation. “From the Naxals of Chhattisgarh to the insurgents in Kashmir, these organisations don’t have liquid cash anymore”, said Jaitley.
Jaitley’s comments come just a day before the anniversary of demonetisation where Prime Minister Narendra Modi on November 8 last year announced the scrapping of old Rs 500 and Rs 1,000 notes as part of the government’s efforts to fight black money and corruption.