Unfazed by criticism of the demonetisation move, Finance Minister Arun Jaitley on Friday said replacing 86% of the currency in circulation with new bank notes could not have been executed in a better way than currently being implemented.
Ten days after the government withdrew 1,000 and 500 rupee notes, he said the move will help banks lend at a cheaper rate to businesses, trade, agriculture and infrastructure while at the same time getting rid of the shadow economy.
“On the execution part, I don’t think this could have been better executed than how it has been executed now,” he said at an ET Now event here.
He said replacing such a large currency without any social unrest and any significant economic disruption was an “achievement”.
“When currency replacement takes place, initial inconvenience takes place, but there is not a single major incident in the country. It’s moving smoothly as every day passes by. The queues are getting smaller,” he said.
“In the next 1-2 weeks, we have to make sure currency reaches rural areas because that is where it’s required. This is the largest currency exchange in the world probably in recent times.”
Indian shopkeepers, traders and retailers, according to Jaitley, will realise that formal official trade is certainly the superior way of doing business than just a shadow economy.
“It has its own pitfalls. And therefore by this shock therapy, everybody enters into the cleaner system of economy. In the long run, it will be welcome by all,” he said.
Stating that there is not any parallel of such a large decision in Indian history in several decades that was ethically and morally so correct, he said every honest man felt that he had no reason to be worried.
The decision has “popular support because there were people with crime money, black money or wealth accumulated by not paying taxes”.
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