Chidambaram slams govt after RBI says 99.3% demonetised notes returned

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Earlier this week, for instance, multiple media reports noted that the BJP used its majority in the parliamentary standing committee on finance to derail discussion and delay the panel's final report on demonetisation, which is reportedly extremely critical of the note-ban exercise. The total value of SBNs in circulation as on November 8th, 2016 was 15417.93 Billion which means almost all (99.15%) banned notes were deposited back indicating that the Demonetization is a big failure.

Over 2.09 lakh non-income tax filers filed their returns and there was an 18 per cent increase in tax revenue, he told reporters. Besides, the value of bank notes in circulation has increased by 37.7% over the year, reaching Rs 18,037 lakh crore by the end of March 2018.

Demonetisation was supposed to be the tonic that cured the financial system of a range of maladies, the government argued. Meanwhile, the country's banks reportedly detected a 480% jump in suspicious transactions post demonetisation.

In the annual report that was released on Wednesday, the RBI said that the processing of Rs 500 and 1,000 banknotes was complete, adding that 99.3 per cent of the notes, worth Rs 15.3 lakh crore have been returned to the banks.

The RBI also said the value of banknotes in circulation stands at 18 lakh crore till the end of the last fiscal.

The "humungous task of processing and verification of specified bank notes (SBNs) was successfully achieved", it said. The remaining fake notes were detected by the regular banks.

The RBI's annual report, however, indicates that demonetisation has not made a huge dent in this regard, as the proportion of high-value notes is marginally lower now than what it was pre-demonetisation.

While The Wire has over the last eighteen months reported and analysed how India's currency-in-circulation (CiC) and currency-to-GDP ratio has not changed drastically after demonetisation, the RBI's annual report provides further proof of how little things have changed.

Quoting RBI report, the Trinamool Congress supremo said 99.3 per cent of the demonetised money has come back to the banking system. Indian economy lost 1.5 per cent of GDP in terms of growth. Meanwhile, the central bank may soon come up with varnished notes to increase their lifespan, which would not only reduce replacement requirement but would also save the central bank from security printing expenditure. However, this is more than double the amount of Rs. 3,421 crore that was spent in the previous year (July 2016 to June 2017).