Free Press Journal

RBI has no inkling of the extinguished black money



New Delhi: The RBI has told a parliamentary panel that it has “no information” on how much black money has been extinguished as a result of demonetisation of Rs 500/1,000 notes; nor does it know how much-unaccounted cash was legitimised through exchange of currency.

Stating that an estimated Rs. 15.28 lakh crore in junked notes has come back, “subject to future corrections based on verification process”, the Reserve Bank also said it has “no information” whether demonetisation is being planned, to be implemented at regular intervals.

The RBI has been facing flak from the opposition parties for delay in disclosing figures on the junked notes, even as the government has maintained that the November 8, 2016, decision to ban Rs. 500/1,000 notes in circulation have helped in curbing black money, among other benefits.Last week in its annual report, the RBI finally made public the details of the junked notes that have come back into the system, putting the figure at Rs. 15.28 lakh crore. The same figure has now been shared with the Parliamentary Standing Committee on Finance.

The central bank also informed the panel that the completion of the process of verification will take time in view of the large volume involved. The process is “going on in full swing” with most RBI offices working in double shifts. The central bank did not give any direct reply on adverse impact on the informal and unorganised sector, as also about the GDP loss.

The RBI said the deceleration in overall economic growth figures for 2016-17 had begun “much before demonetisation” due to weakness in industrial and services sector.In its annual report for 2016-17, the RBI had disclosed that all but about 1 per cent of the scrapped currency notes have come back into the system.