Around Rs 9.2 lakh crore in new currency notes has been introduced into the Indian economy since Rs 500 and Rs 1,000 bills were demonetised, Reserve Bank of India Governor Urjit Patel said on Wednesday, according to ANI. Appearing before Parliament’s Standing Committee on Finance, Patel is believed to have said that he was not aware of how much money in the scrapped notes had been deposited in banks across the country.
The RBI governor was summoned to brief the parliamentary panel on the currency ban and the steps taken by the central bank to deal with its effects on the Indian economy. Patel reportedly said that it was also not possible to gauge when banking operations around the country would normalise. The Veerappa Moily-led committee criticised the RBI governor for not answering their questions on demonetisation.
Moreover, former prime minister Dr Manmohan Singh, who has also served as the RBI chief, intervened when Patel was asked whether there would be chaos if the central bank revoked the current limits on cash withdrawals. “You should not reply to that query,” he said after fellow Congress leader Digvijaya Singh directed the question at the RBI governor, officials told NDTV.
Economic Affairs Secretary Shaktikanta Das, Revenue Secretary Hasmukh Adhia and ICICI Bank CEO Chanda Kochhar also appeared before the committee, Business Standard reported. Patel is scheduled to meet the Public Accounts Committee on Friday for a briefing on demonetisation.
The meetings follow accusations that the RBI is dealing with interference from the Centre and has lost its autonomy. An RBI employees’ union had written to Patel, urging him to “do away with unwarranted interference” from the Finance Ministry. The United Forum of Reserve Bank Officers and Employees had said that the central bank’s image had been “dented beyond repair”. The forum represents three RBI unions, which include more than 18,000 RBI employees.
On November 8, Prime Minister Narendra Modi had announced that Rs 500 and Rs 1,000 bills will no longer be legal tender. The RBI has been facing flak for being unprepared to tackle the cash crunch that followed. On December 23, former prime minister and RBI governor Manmohan Singh had questioned whether the top bank was given sufficient time to deliberate over the government’s currency ban decision.
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