Impact of Rs 2,000 notes withdrawal marginal on economy: Shaktikanta Das

notes withdrawal marginal on economy

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Reserve Bank Governor Shaktikanta Das on Monday said the impact of withdrawal of Rs 2,000 currency notes will be "very very marginal" on the economy because it accounts for only 10.8 per cent of currency in circulation.

Describing the withdrawal exercise as part of currency management operations of the Reserve Bank, he said, he expects most of the withdrawn Rs 2,000 notes to be returned to the exchequer by the deadline of September 30.

Talking to reporters, Das said, "the impact of this on the economy will be very very marginal because it is only 10.8 per cent of currency in circulation.

As you know that Rs 2,000 notes were not commonly used in any transaction We have found that it is hardly being used for carrying out transactions. Therefore, economic activity will not be impacted."

As part of a clean note policy, he said, RBI has been conducting such exercise of withdrawal of currency notes from time to time and such exercise was undertaken in 2013-14, whereby the notes which were printed prior to 2005, were withdrawn from public circulation.

So, he said, withdrawal of Rs 2,000 notes is part of clean note policy and they continue to be a legal tender.

Asked if Rs 2,000 notes will continue to be a legal tender, Das said "It will continue as legal tender. We will wait how many notes are coming. I cannot give a speculative answer about what will happen post September 30."

Most of the notes are expected to come back, he said, adding "that is our expectation at this stage. We will see how many notes come back. And as we approach September 30, we will decide at that stage."

He said there is enough time available for exchange and deposit in bank accounts so people should not panic.