The government’s gain from note ban will be only 2 lakh crore?

952 Views Updated: 22 Dec 2016
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The government’s gain from note ban will be only 2 lakh crore?

It has been a topic of intense debate as to how many old denomination 500 and 1000 Rs notes will come back to the bank.

State Bank of India estimates that around 13 Lakh Crore worth of banned notes could come back into the banking system. This will leave scope for 2.5 Lakh crore of banned currency which will never come back in the banking system.

It is further estimated that out of this 2.5 Lakh Crore, 1.5 Lakh Crore would be the money which is involved in unlawful activities. Further out of this 2.5 Lakh Crore Rs 1 Lakh Crore could come back as a disclosure under the self-declaration scheme for undisclosed money.

Benefits from demonetization

Demonetization has benefitted Indian economy to a great extent. All the black money floating in the market became useless with this decision. Terrorism also suffered a mighty blow as terror groups were caught in a catch 22 situation since their Hawala money lost its value. The deposits in Jan Dhan scheme also increased as people deposited money in their accounts.

Moreover, demonetization motivated people to open bank accounts and deposit their savings in these accounts. 

The nature of exact gain can be understood from the fact that currency to the tune of Rs 2 Lakh Crore after taking into account the penalties which are imposed on people coming with a large amount of money.

Posted by: Lovnish Thakur Posts: (277) Opinions: (20) Points: 21,130 Rank: 1

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