New Delhi, March 11: The RBI board, which included the present Governor Shaktikanta Das as a director, had warned of short-term negative impact of demonetisation on the country’s economic growth and observed that the unprecedented move would not have any material impact on tackling the black money menace.
The board, according to minutes of the meeting revealed by the central bank in an RTI reply, had met just two-and-a-half hours before Prime Minister Narendra Modi in an address to the nation announced the demonetisation decision on November 8, 2016.
Curbing black money was one of the prime objectives of the shock move to junk old Rs 500 and 1,000 notes, which saw 86 per cent of high-value currency going out of circulation.
The minutes of the crucial board meeting, which approved the government’s request for demonetisation, recorded the presence of the then RBI Governor Urjit Patel and the then Economic Affairs Secretary Shaktikanta Das. Others at the board meeting included the then Financial Services Secretary Anjuli Chib Duggal, and RBI deputy governors R Gandhi and SS Mundra. Both Gandhi and Mundra are not part of the board now, while Das was appointed the RBI governor in December 2018.
“It is a commendable measure but will have short-term negative effect on GDP for the current year,” as per the minutes posted by RTI activist Venkatesh Nayak on the website of Commonwealth Human Rights Initiative.
