At no point was RBI asked on demonetisation decision, says former RBI governor Raghuram Rajan
Former Reserve Bank of India (RBI) governor Raghuram Rajan revealed that the RBI was not consulted before demonetisation decision.
Former Reserve Bank of India (RBI) governor Raghuram Rajan has finally broken his silence as he completes one year of his exit.
Rajan, who has written a book on his stint as the governor of the RBI, revealed that the RBI was not consulted on demonetisation.
Rajan in his latest book "I do what I do", which is a collection of his speeches during his tenure as RBI governor said, "At no point during my term was the RBI asked to make a decision on demonetisation", as quoted by Hindustan Times.
According to the report, Rajan said, "I was asked by the government in February 2016 for my view on demonetisation, which I gave orally. Although there might be long-term benefits, I felt the likely short-term economic costs would outweigh them. I made these views known in no uncertain terms."
Further, Rajan said that though he had disapproved the demonetisation idea, the government had asked RBI to prepare a note and hand it to the government.
Rajan's comment came in at the time when recently the Ministry of Statistics & Programme Implementation data showed that country's GDP has slowed down to 5.7% in Q1FY18.
Also, on August 31, the RBI said that nearly 99% of all the demonetised Rs 1000 notes have come back into the banking system.