Prime Minister Narendra Modi, in the fourth year of demonetization implementation, which aims to remove hidden money from the tax collector, known as black money, said that “demonetization has helped reduce black money, increase compliance tax and formalization and has given a boost to transparency. “
In a tweet explaining the growth since demonetization took effect, the prime minister also said that “these results have been very beneficial to national progress.”
Echoing the prime minister’s thinking, Finance Minister Nirmala Sitharaman said demonetization led to better tax compliance and a big push towards the digital economy.
Underlining the merits of demonetization, in a series of tweets, Sitharaman said: “To fulfill its promise to rid India of corruption, the Modi government implemented demonetization 4 years ago on this day, today. The move that was an unprecedented attack on Black Money also led to better tax compliance and a huge boost to the digital economy. “
Sitharaman said ₹Rs 900 million of undisclosed income was seized in the first four months after the demonization. And in the last three years, assets worth ₹Rs 3,950 million were seized. While surveys conducted after demonetization led to the discovery of undisclosed income worth several crore, Operation Clean Money helped formalize the economy, he added.
Meanwhile, Congressional leader Rahul Gandhi criticized the government for demonetization, claiming that Prime Minister Modi’s move four years ago was aimed at helping some of his “crony capitalist friends” and had “destroyed” the Indian economy.
Gandhi and Congress have been claiming that the 2016 demonetization was not in the people’s interest and had adverse effects on the economy, a charge that the government has repeatedly rejected.
In a video posted as part of the party’s ‘SpeakUpAgainstDeMoDisaster’ online campaign, Gandhi said the question is how the Bangladesh economy “outperformed” the Indian economy, as there was a time when India used to be one of the world’s highest performing economies.
“The government says the reason is COVID, but if that is the reason, there is also COVID in Bangladesh and other parts of the world. The reason is not COVID, the reason is ‘Notebandi’ and GST,” Gandhi said in Hindi.
The prime minister had said it is a fight against black money, but it was not, Gandhi said.
“This was a lie. The attack was against you, Modi wanted to take your money and give it to his 2-3 crony capitalist friends. You made lines, not his crony capitalist friends. You put your money in the banks and Prime Minister Modi gave that money to his friends and gave them a loan exemption of ₹3,50,000 crore, “Gandhi claimed.
On November 8, 2016, Prime Minister Modi announced the decision to ban all higher denomination banknotes from ₹500 and ₹1,000 since midnight.
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