New Delhi, Aug 29, 2018 : Indians have deposited almost all the currency notes made illegal by Prime Minister Narendra Modi in 2016, the central bank said in a report after a count that lasted nearly two years.
Banks have received Rs 15.3 trillion ($217 billion), or 99.3% of the currency invalidated, the Reserve Bank of India said in its annual report on Wednesday. An amount of Rs 107 billion has not yet been received by the RBI after the cash ban, the report said.
The government had initially estimated about Rs 5 trillion of the Rs15.4 trillion rendered worthless on Nov. 9, 2016 wouldn’t return to the system, indicating that this was cash stashed away illegally to avoid tax.
The cash ban had prompted the central bank to print new currency, reducing its profit and cutting annual dividend payout to the government by half last year. This year, it transferred Rs 500 billion to the government as dividend, compared with Rs 306.6 billion a year ago. RBI’s accounting year runs from July to June.
Modi’s decision to ban high-value currency notes, along with a chaotic introduction of the goods and services tax last year, acted as a drag on economic expansion. Growth has since rebounded and in the quarter ended March 2018, the economy expanded 7.7% from a year earlier.