 "PM Modi has set a new normal with demonetisation, says Jaitley")
Prime Minister Narendra Modi has set a new normal for the Indian economy with his bold step to demonetise high-value currency notes, Union Minister for Finance and Corporate Affairs Arun Jaitley said here.
Addressing a public meet organised by the state BJP unit, the Union minister said: "To replace existing currency and unearth hidden currency which is even used in crime and terror activities is indeed a tough step. This decision taken by the Prime Minister was not easy for any leader.. to attempt to change the mindset prevailing for 70 years was not easy. Prime Minister Modi has created a new normal — he has redefined the new normal".
Jaitley said the decision to demonetise has enthused the people of the country. For the first time, an honest man in the country feels there is a reward for his honesty.
The minister indicated the demonetisation move would have a multiplier effect on the economy, especially in the banking system that suffered from the hangover of NPAs (non-performing assets) from the UPA regime.
"Previously, we used to allocate funds in the Budget to re-capitalise the banks. Now, banks have got lakhs of crores of rupees into their savings and current accounts. This would be reflected in lending to corporates, infrastructure and social sectors. It can also influence interest rates where RBI (Reserve Bank of India) will take the call."
As the government completes the re-monetisation process, a large portion of the economy shifts to digital payments, use of paper currency comes down and the economy gets more formal, Jaitley said.
More From This Section
He said, even after two and half years of the NDA government, the people have not got disenchanted with the ruling dispensation which usually happens after six months because of a host of factors like lack of policy measures and weak leadership. But, this has not happened with the Narendra Modi government, he claimed.
"In West Bengal and Tripura where we were in a comparatively weaker position, we have bounced back in the by-polls to reach the second spot", he said.
Earlier speaking at the 'Make in Odisha' conclave, Jaitley said, the world is facing many economic challenges but India has remained one of the islands of growth.
He said, demonetisation and the proposed Goods & Service Tax (GST) would be game changers for the economy and benefit the whole country including a state like Odisha.
"Under GST, the whole country would be one big market. There would be a seamless flow of goods and services. Tax evasion would become increasingly difficult under GST", he added.
Jaitley said obstacles meant for the obstructing introduction of GST would not succeed as there is a Constitutional obligation for rolling it out within a year of its notification. The GST was notified on September 16, 2016.