New Delhi: Prime Minister Narendra Modi could be asked to explain his abrupt demonetization drive to a parliamentary committee, its chief, Congress leader VK Thomas, said today according to news agency.
The Public Accounts Committee has ordered Urjit Patel, the Governor of the Reserve Bank of India, to meet it on the 20th of this month to explain both how the decision to demonetize was taken as also the impact on the country’s economy.
Mr Patel has also been sent a detailed list of questions on the process that abolished 500 and 1,000-rupee notes at just a few hours’ notice on November 8. The cash shortage that resulted has eased up a little in recent days, but there’s still nowhere near enough of the new notes in supply and economists predict a slowdown in growth.
“The committee has all right to call anybody involved in the matter. But that will depend on the outcome of the January 20th meeting. We can call PM on demonetisation issue if members unanimously decide,” said Mr Thomas. He also said that when he met with the PM after the reform was introduced, “He said that the situation will be normal after 50 days by December-end. But it does not looks like (it).”
RBI Governor Patel has been heavily faulted, including by opposition leaders, over the shortage of replacement currency and the continuing restrictions on the cash that people can withdraw from banks.
The Public Accounts Committee has asked Governor Patel to provide details on the value of currency that has been returned, the quantity of “black money” it has received and the amount of new currency released so far. Latest reports suggest that of the 15.44 lakh crores that was yanked from circulation, nearly all has been turned into banks, blowing out the claim that demonetization would help destroy or uncover untaxed money. The RBI last released an estimate on December 10 – at the time, it said nearly 12.44 lakh crores or 80% of the outlawed notes had been deposited in banks.
Mr Thomas added that the RBI Governor has also been asked about the country’s preparedness to handle cashless transactions.
“In a country where there is a call drop problem and telecom facilities are not smooth, how can PM expect e-transactions would take place on mobiles. Do we have sufficient infrastructure?” asked Mr Thomas.
He said the questionnaire sent to the RBI Governor seeks answers to who was involved in the decision to outlaw high-denomination notes and whether restricting people’s access to their money is allowed by law.