Demonetisation: Was RBI given enough time to discuss note ban, Manmohan Singh asks House panel

Manmohan Singh also suggested that the panel — which is looking into the demonetisation decision — call government officials to depose before it hears RBI Governor Urjit Patel.

Written by Anand Mishra | New Delhi | Updated: December 23, 2016 11:23 am
demonetisation, demonetisation debate, RBI, RBI rules, manmohan singh, narendra modi, black money, note ban, currency ban, cash ban, rs 500 ban, rs 1000 ban, urjit patel, indian express news, india news Former Prime Minister Manmohan Singh. (File Photo)

During a meeting of the Parliamentary Committee on Finance on Thursday, former Prime Minister Manmohan Singh sought to know whether the RBI was given sufficient time to hold deliberations on the government’s demonetisation move. He also suggested that the panel — which is looking into the demonetisation decision — call government officials to depose before it hears RBI Governor Urjit Patel.

The issue was being discussed in presence of independent experts, including economists Rajiv Kumar and Mahesh Vyas, former chief statistician Pronab Sen and Kavita Rao of National Institute of Public Finance and Policy, who had been called to offer their views to the panel. Three of the experts were critical of the demonetisation decision, sources said.

“We were discussing when the RBI governor should appear before the panel. Singh said that according to a note from the RBI, the government took the decision on November 7 and the RBI board decided on it on November 8. So it would be better if the panel hears from the government first and then calls the RBI governor. Singh said that the panel can then ask the RBI governor regarding autonomy of the institution,” a panel member, who attended the meeting, told The Indian Express.

Accordingly, RBI governor Patel will brief the panel on January 18 or 19 on demonetisation and its implications, while government officials, mostly from the finance ministry, will be asked to depose before it on January 11 or 12.

A BJP member of the panel said, “What Singh was apparently suggesting was that the RBI was not adequately involved in decision-making. He said the government took a decision and then asked the RBI to follow it, after which the RBI board approved it.” He added, “The government is saying it took the decision in view of reasons like Naxalism, drugs, terrorism, counterfeit currency. These come under the Home Ministry, not Finance Ministry.”

Another member confirmed to The Indian Express that the former PM flagged the issue of RBI’s autonomy during the meeting.

One of the experts said that if the expenditure on note printing, overtime work by bank staff and productive time of people standing in queue are taken into account, the overall cost would outweigh the benefits of demonetisation.

At this, a source claimed, a BJP member said that by that logic, the Election Commission should count the productive time of people standing in queue in its election cost.

At their next meeting, the panel members are planning to ask questions about the steps taken by the RBI to ease the cash crunch. The panel will also hear bankers and representatives of the Indian Banks’ Association.

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  1. A
    Abhinav Gour
    Dec 23, 2016 at 2:22 am
    Best advise to u mms is shut up
    1. I
      Dec 23, 2016 at 4:18 am
      For 8 years he did nothing and presided over unprecedented corruption. Now that Modi is trying to do something about black money, MMS is complaining.
    2. I
      Dec 23, 2016 at 4:20 am
      I think MMS forfeited his moral authority after cwg, 2g, coal, tatra, adarsh, vadra land scams
      1. R
        Dec 23, 2016 at 12:41 pm
        It is absurd to believe that RBI was not given sufficient time to be prepared. PM takes the decision on 7 nd RBI gives its approval on 8 both of them do not think of its implementation. It's totally a childish decision. Who is responsible for death of 100 people. Rkdas
      2. C
        Chandu Shah
        Dec 23, 2016 at 8:51 am
        Manmohan the puppet
        1. H
          Haradhan Mandal
          Dec 23, 2016 at 6:25 am
          uming that (accepting the argument that all in RBI are "crooks" and sympathizers of "crooks and lootera abd thieves") , what about their own CABINET meeting of the GOVT and what about an approval from the cabinet , made of SR cabinet ministers, SR leaders and Patriot leaders - none of therm are arguably crooks(!) , OR, ARE THEY potentially -by this argument? lt;br/gt;If they decide that they have to go to WAR against stan, will they keep it secret from the ARMY, will they ask the General to go to war after declaring war on one 8th November night with a surprise to the army generals coming from the TV address - SIMPLY because the Army and the generals CAN NOT BE TRUSTED (!????) . lt;br/gt;If RBI is full of "crooks" - what will be our FATE going forward!? What steps were taken against RBI in 2.5 years?
          1. H
            Haradhan Mandal
            Dec 23, 2016 at 4:09 am
            Isn't it a wake up call for all right thinking (and self-respecting) Leaders (National and State level CM and leaders) to sit down and discuss - "Should such important and POTENTIALLY catastrophic decision be left with JUST ONE INDIVIDUAL and his close coterie of one or two sycophants"???? lt;br/gt;NON-despotic and democratic functioning of a MATURED democratic country and govt PROVIDES FOR CHECKS and BALANCES - such as cabinet meeting,such as getting approval from 2/3rd of the states (in some cases), getting ped in the parliament and also from state legislatures (some times). All these are not just just formalities and for Rituals of democracy. It has its own reasons.
            1. H
              Haradhan Mandal
              Dec 23, 2016 at 8:40 am
              This is what amazes me. They call Rahul hi a Pappu. And they day and night show - who are the real Pappus . History of 1971 did not happen in "VEDIC" age (that anything you say/cook up becomes History and facts) . Many people have seen 1971 war happening in front of own their eyes and they are not dead. You can not even search google and find out who was the Defence Minister then. And you even don't know who was Sardar Swaran Singh and if he ALSO knew or not (other than the "defence" minister). General Manik(*!?) Shaw is a knighted "Sir" - by the Queen? I did not know that!
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