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India’s Demonetisation: 99% banned notes returned to Central Bank
August 31, 2017, 5:33 am

File photo: Demonetisation had forced millions into lengthy bank queues [Xinhua]

Indians have deposited nearly all the currency bills outlawed at the end of the deadline last year, dealing a blow to Prime Minister Narendra Modi’s drive to unearth unaccounted wealth and fight corruption.

The Central Bank said on Wednesday that 99 per cent of the estimated 15.4 trillion rupees ($242 billion) banned last year has made its way back into the banking system.

The government had initially estimated about 5 trillion rupees, of the 15.4 trillion rupees rendered worthless by “demonetisation” on November 9 last year, to remain undeclared as it may have escaped the tax net illegally.

In November, India’s prime minister, Narendra Modi, announced the sudden voiding of the country’s two most-used bank notes.

The move has dented economic growth and had forced millions into lengthy bank queues. Economic growth slowed down to 6.1 per cent in January-March.

India’s Finance Minister Arun Jaitley defended the demonetisation drive of the government.

“The real object of demonetisation was formalisation, attack on black money, less cash currency, bigger tax base, digitisation, a blow to terrorism,” Jaitley said on Wednesday.

“And we do believe that in each of these areas, the effect of demonetisation has been extremely positive,” he added.

TBP and Agencies

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