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Did RBI Have Just One Day To Make A Decision On Demonetisation, Asks Manmohan Singh

Were they given enough time?

23/12/2016 11:47 AM IST | Updated 23/12/2016 2:00 PM IST
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In this photograph taken on November 16, 2016, Indian villagers wait inside the bank to make the transactions in Basendua village in Bulandshahr, in northern Uttar Pradesh state.

NEW DELHI -- Former Prime Minister Manmohan Singh has reportedly questioned whether the Reserve Bank of India (RBI) was given adequate time to evaluate the government's demonetisation decision before it was announced on 8 November. The economist, who is part of a panel at the parliamentary committee on finance that is looking into the government's decision to ban ₹500 and ₹1,000 notes, said that he also wanted to ask RBI governor Urjit Patel if the central banking institution had autonomy in making this decision.

"What Singh was apparently suggesting was that the RBI was not adequately involved in decision-making," an unnamed BJP member of the panel told Indian Express. "He said the government took a decision and then asked the RBI to follow it, after which the RBI board approved it."

The RBI is supposed to control the monetary policy of the Indian rupee. According to a note from RBI, reported Express, the government took its decision to demonetise the larger currency notes on 7 November, and the RBI made its decision the next day.

According to the report, the panel has asked finance ministry officials to brief them about the demonetisation decision in the second week of January, following which the RBI governor will answer the panel's questions a week later.

Earlier, Singh has called the process of demonetisation a "monumental failure" and "organised loot", alleging it was badly planned and has had deep repercussions on common Indian citizens.

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