On November 8, 2016, Prime Minister Narendra Modi announced demonetisation of Rs 500 and Rs 1000 notes. Post demonetisation the government replaced the old Rs 500 notes with new notes but no replacement of Rs 1000 have been made. Instead, the government introduced new notes of Rs 2000.
As much as 99.3 percent of the junked Rs 500 and Rs 1,000 notes have been returned to the banking system, said the Reserve Bank of India (RBI) in its annual report. It indicated that just a minuscule percentage of currency was left out of the system after the government's unprecedented note ban aimed at curbing black money and corruption.
RBI, which has taken a long time to count the currency that was returned in the limited period window provided by the government to exchange or deposit the demonetised currency, said in its Annual Report for 2017-18 that the exercise is finally over.
Of the Rs 15.41 lakh crore worth Rs 500 and Rs 1,000 notes in circulation on November 8, 2016, when the note ban was announced, notes worth Rs 15.31 lakh crore have been returned. This meant Rs 10,720 crore of the junked currency did not return to the banking system.
After the note ban, old junked notes, called specified bank notes (SBNs), were allowed to be deposited in banks with unusual deposits coming under income tax scrutiny. The "humongous task of processing and verification of specified bank notes (SBNs) was successfully achieved," it said. The SBNs received were verified, counted and processed in the sophisticated high-speed currency verification and processing system (CVPS) for accuracy and genuineness and then shredded, it added.
RBI said the processing of SBNs has since been completed. "The total SBNs returned from circulation is Rs 15,310.73 billion." Post-demonetisation, RBI spent Rs 7,965 crore in 2016-17 on printing new Rs 500 and Rs 2,000 and other denomination notes, more than double the Rs 3,421 crore spent in the previous year.
P Chidambaram, the former finance minister, lashed out at the BJP government for causing a loss of "huge amount" to the country for a "small sum of the amount".
"So, government and RBI actually demonetised only Rs 13,000 crore and the country paid a huge price. Over 100 lives were lost. 15 crore daily wage earners lost their livelihood for several weeks. Thousands of SME (small and medium enterprises) units were shut down. Lakhs of jobs were destroyed," Chidambaram said.
"Every rupee of the Rs 15.42 lakh crore (barring a small sum of Ra 13,000 crore) has come back to the RBI. Remember who had said that Rs 3 lakh crore will not come back and that will be again for the government!?" he added.
(With inputs from PTI)
