Finance Minister Arun Jaitley on Friday defended the central government’s demonetisation decision, terming it as a courageous step and assured that remonetisation will not take a very long time.
Addressing the 89th annual general meeting of the Federation of Indian Chambers of Commerce and Industry’s (FICCI) here, Jaitley expressed confidence that the Reserve Bank of India will be able to complete the entire process very soon.
"The whole process of remonetisation is not going to take very long time and I'm sure very soon the Reserve Bank by injecting currency daily into the banking and postal system will be able to complete that," Jaitley said, hinting that not all of the Rs 15.44 lakh crore worth of currency junked will be remonetised through issuance of new notes as he said digital currency will fill the gap.
“Government has taken a ‘courageous step’ in the direction of removing the legal tender nature of high-value currency notes and went in for a large scale currency swap," Jaitley added.
“One needs clarity, courage, broad shoulders and the stamina to take such decisions,” he further said.
The Finance Minister also said that demonetisation decision will mark the creation of a new normal for India.
"Notes ban marks an important beginning, with this move besides implication, once remonetisation is complete and makes substantial headway it will mark creation of new Indian normal because the one which was for 70 years was unacceptable," he said.
Jaitely further emphasised that notes ban will have long-term benefits even if people have to face short-term inconveniences
Talking about government’s initiative to encourage citizens to adopt cashless payments and a digital economy, Jaitely said that there are over 75 crore debit and credit cards, different types of e-wallets coming up and 100 to 1,000 per cent rise in use of digital modes of payments.
On GST, the Finance Minister exuded confidence about reaching a consensus with States on the legislations that need to be passed to operationalise it.
“Ideally, GST should start from April 1, 2017 as there is a constitutional necessity for it to come into force between Apr 1 & Sep 16,” Jaitely said.
“As far as current mode of taxation is concerned, the curtains will be down on 16 September 2017,” he added.
Prime Minister Narendra Modi on November 8 declared the Rs. 500 and Rs. 1000 notes ineligible as a legal tender to flush out black money and terror funding.
As many as 17,165 million pieces of Rs 500 denomination and 6,858 million pieces of Rs 1,000 banknotes were in circulation on November 8 when the government made the surprise announcement.
