Demonetisation anniversary: Note ban took the country on path of a less-cash economy, says Devendra Fadnavishttps://indianexpress.com/article/india/demonetisation-anniversary-note-ban-took-the-country-on-path-of-a-less-cash-economy-says-devendra-fadnavis-4928622/

Demonetisation anniversary: Note ban took the country on path of a less-cash economy, says Devendra Fadnavis

"Despite being a renowned economist, Manmohan Singh brought the economy into disrepute, while Modi, who is not an economist, earned India a reputation of being the fastest growing economy in the world," Fadnavis said

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Devendra Fadnavis with Tata Group chairman N Chandrasakeran at the inauguration of TCS Olympus Centre at Hiranandani Estate in Thane on Wednesday. (Source: PTI)

Chief Minister Devendra Fadnavis on Wednesday strongly defended the Narendra Modi government’s demonetisation move, saying along with GST it brought the entire money from the informal to formal economy and took India on the path of becoming a more tax-compliant society.

“Digital transactions worth Rs 6.6 lakh crore was carried out. It is the greatest achievement of demonetisation since it took the country on the path of a less-cash economy,” Fadnavis said during a press conference to mark the first anniversary of note ban.

Reeling out statistics to buttress his claims, Fadnavis said, “Now that the entire currency is back in RBI coffers, it will be known who carried out suspicious transactions and the Income Tax Department is already vetting transactions worth Rs 2.69 lakh crore. It will be known as to which money was black and which one was white.”

On Tuesday, former prime minister Manmohan Singh called demonetisation an organised loot and legalised plunder that broke the back of small businesses. Fadnavis did not lose an opportunity to hit back at Singh. Comaparing the performances of the former and current PM, he said, “Despite being a renowned economist, Manmohan Singh brought the economy into disrepute, while Modi, who is not an economist, earned India a reputation of being the fastest growing economy in the world.”

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The CM said over 56 lakh new people had come into the income tax net and advance tax collection saw a 42% increase. “The number of direct and indirect tax payers has gone up from 3 crore to 6.3 crore, making India a more tax-compliant society,” he said.

As against a view expressed by many leading economists that shell companies could have been cracked down even without demonetisation, Fadnavis said, “The government has deregistered 2.24 of 2.97 lakh such companies and it was possible only due to demonetisation.” The CM also claimed that there had been a massive surge in investments through public and mutual funds post-demonetisation.

On the issue of “negative sentiment” prevailing among traders post-demonetisation and GST rollout, he said, “There is no negative sentiment. There were going to be some problems after GST rollout but now demand and sale have gone up immensely over the past months.” Among other achievements, he said, “Over one crore new workers were registered in EPF and ESIC registers.”

He attributed the post-GST slump in growth rate to clearance of existing stocks and stoppage of production by industries. “Now with demand and sale going up it is again shooting up” he said. Fadnavis also cited a chain of decisions, including treaties with various countries, to plug outflow of money to foreign tax havens.

Asked why the Modi government didn’t expose those who had taken the tax haven route to evade taxes, he said, “Some treaties don’t allow naming of the people. But the list we have submitted to the Supreme Court has many more names.”

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