What Jaitley Said About Demonetisation vs What PM Modi Promised

Has the ruling party changed its stance on demonetisation?

Rs 500 and Rs 1,000 notes were discontinued from 8 November 2016. (Photo: PTI)

The objective of demonetisation was not just to confiscate black money, Finance Minister Arun Jaitley said in response to Reserve Bank of India data, suggesting that 99 percent of demonetised currency was deposited into the banking system.

More taxpayers, a bigger tax base, more digitisation, lesser cash in the system, integration of the formal and informal economy – these were the principal objectives, the finance minister in a media conference on 30 August.

Also Read: 99% of Demonetised Notes Back in Banking System: RBI Annual Report

We intended to give a blow to black money and... expand the tax base of the country. It is obvious that post demonetisation, the direct tax base has already started expanding substantially.

The minister said that the government has taken steps to squeeze out cash from the system and his next step would be stop use of black money in elections.

Also Read: Demonetisation Was Not Designed Only To Fight Black Money: Jaitley

Demonetisation, he said, has left terrorists and separatists in Chhattisgarh and Jammu and Kashmir cash starved. He also added that the note ban has compelled people to deposit money into bank accounts.

Flashback: PM Modi’s Demonetisation Speech on 8 November 2016

In a stark contrast to his finance minister's statements, Prime Minister Narendra Modi’s 8 November 2016 speech while introducing demonetisation did not mention digital transactions or pruning India's reliance on cash even once.

Modi’s stated objectives? Breaking the grip of corruption, black money, terror financing and counterfeit currency.

Also Read: Demonetisation: The Big Event That Turned Out To Be A Non-Event

Here are the highlights of PM Modi’s 8 November 2016 speech, announcing demonetisation.

• “Corruption, fake currency and terrorism are festering wounds, holding back the economy”.
• “Nearly 1 lakh 25 thousand crore rupees of black money belonging to the corrupt is in the open”.
• “Through demonetisation, rights and the interests of honest, hard-working people will be fully protected”.
• “RBI to limit the share of high denomination notes in the total currency in circulation”.

Also Read:

Dear PM Modi, Demonetisation Worked But Could Have Spared the Poor
Woman Dies, Leaving Behind Demonetised Notes Worth Rs 4 Lakh
Demonetisation Has Squeezed Terror Funding: Jaitley in Lok Sabha

Producer: Sayantan Datta

(This story has been updated with Finance Minister Arun Jaitley’s comments.)