Rejecting apprehensions that the Indian economy would suffer due to demonetisation, Finance Minister Arun Jaitley today termed as “game changers” the pulling out of high-value old notes as well as Goods and Services Tax, which is proposed to be rolled out from April 1.
“I do believe that both (GST and demonetisation) will be game changers. This is because GST will ensure higher taxation as far as the Centre is concerned and also higher taxation for states. It is an efficient system. It blocks leakages. It will certainly help the consuming states like Odisha,” he said.
Jaitley was speaking at the “Make in Odisha” conclave here.
On the hue and cry over the demonetisation exercise, he said: “As far as currency changes are concerned, once the demonetisation process is completed and the economy gets back to full stream, the size of the GDP will significantly expand, tax base will expand.”
He added, “More money will come to the banks which will be used fruitfully for the betterment of the economy.”
Hitting out at Left parties and Congress for raisingquestions about the move to promote digital currency, Jaitley asserted that paper currency was going to fall as the country moved towards a cashless economy.
Slamming the critics, he said the figure of digital currency in the form of debit and credit cards in the country stood at over Rs 80 crore, out of which cards worth around Rs 45 crore were in active use now.
Therefore, the use of digital currency is definitely going to increase in the country as people in crores have already started using it, he said, adding that after a few months the “temporary difficulties” seen following note-ban would disappear.
Stating that “re-monetisation would automatically follow demonetisation” with alternative currencies replacing the old ones, the minister added that lakhs of crores of rupees which remained outside the system was being brought within.
Referring to challenges before Indian economy, Jaitley said while global economic slowdown had its impact, banks had become weak and lost their ability to support the economy, affecting work in infrastructure and many other sectors.
“With demonetisation of high value currency notes, the banks are going to be flush with money, which would play a significant role in giving a boost to industrial, developmental and commercial activities,” he said.
Demonetisation drive coupled with introduction of GST would definitely bring a better future for the country with safeguards against corruption, the minister added.