Govt. Advised Reserve Bank For Demonetization: RBI
Until now the government has suggested demonetization nod came from Reserve Bank of India (RBI), but last month’s submission of the organization to a Parliamentary panel reveals the advise was other way.
In a seven-page note the RBI suggests on November 7 the government advised them to mitigate the triple problems of counterfeiting, terrorist financing and black money.
Submitted on December 22 to the Parliament’s Department Related Committee of Finance the note further adds government said cash has been a facilitator of black money and elimination of it will add to the growth of the country.
Congress leader M Veerappa Moily is currently heading the Parliament’s Department Related Committee of Finance.
Fake Indian Currency Notes (FICN) has been widespread in India and used for the financing of terrorism and drug financing.
The origin of FICN is in neighboring country and is a threat to the integrity and security of the country.
It is learned the RBI Central Board met the very next day to consider the advice and it was decided to withdraw the two biggest denominations from the circulation.
The same evening Indian Prime Minister Narendra Modi announced the decision on national TV with immediate effect, midnight November 8.
RBI also recalled prior to November 8 to had suggested the government the need for Rs 5,000 and Rs 10,000 denomination notes to manage currency logistics and facilitating payments.