Demonetisation revelation: FinMin babus say note ban discussions started in early 2016

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New Delhi | Updated: January 18, 2017 4:35:50 PM

Sources had stated that there was no reply by the Finance ministry officials when questions were raised on how much old demonetised notes had returned to the bank and how much amount of new notes had been printed.

Demonetiation, Reserve Bank of India, BJP, Narendra Modi, Note Ban, Black Money, Parliament Panel on Demonetisation, currency counterfeitingThe Reserve Bank of India (RBI) Governor Urjit Patel, today, appeared before the Standing Committee on Finance. (Reuters)

As the Reserve Bank of India (RBI) governor, today appeared before the finance panel to brief demonetisation, sources had stated that there was no reply by the Finance ministry officials when questions were raised on how much old demonetised notes had returned to the bank and how much amount of new notes had been printed. Sources further confirmed that the Finance ministry officials had said the Standing committee panel that the discussions on the pros and cons of demonetisation had started early 2016.

Following the meeting, Standing Committee on Finance member Saugat Roy of Trinamool Congress (TMC), stated that the the RBI Governor was unable to declare when the system will get normal. Also stating that the RBI was defensive on the matter, Saugata Roy said that the Governor was unable to tell us how much money has come back to the banks.

However, the Reserve Bank of India (RBI) Governor Urjit Patel said the standing committee members that Rs 9.2 lakh crore in new currency notes had been introduced. Urjit Patel, today, appeared before the Standing Committee on Finance.

The committee, headed by former union minister and senior Congress leader Veerappa Moily, had called Patel to brief the panel about government’s demonetisation drive. The secretaries of finance ministry had also appeared and briefed about demonetisation and its impact.

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Patel had been summoned, days after the United Forum of Reserve Bank Officers and employees wrote a letter to the RBI governor alleging that the image of the central bank has been dented beyond repair post the government’s demonetisation move.

Raising objection to the government “impinging on RBI autonomy” the employee unions of the central bank also asked Patel to take action against the “unwarranted interference”.

“We request the Governor of the RBI, its highest functionary and protector of its autonomy and prestige, to do the needful urgently to do away with this unwarranted interference from the Finance Ministry and assure the staff accordingly as the staff feels humiliated,” the letter said.

The finance ministry, however, clarified that the government fully respects the independence and autonomy of the RBI. In a statement, the ministry said that consultations between the Centre and the RBI are undertaken on various matters of public importance, wherever such consultation is mandated by law or has evolved as a practice

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