RBI Governor says no negative impact on economy due to Rs 2000 note withdrawal

RBI governor on 2,000 rupees note withdrawal. Photo Credit: Google
Advertisement

INDIA: It has been more than a month since the Reserve Bank of India announced the withdrawal of rupees 2000 notes. Even after the announcement on May 19, the note would remain legal tender as per the notice. However, speculations were being made that this move would result in a negative impact on the Indian economy. Discarding all the speculations, RBI governor Shaktikanta Das said that it will not have any negative impact on the economy as per a video shared by Press Trust of India PTI. He can be seen stressing that nothing like that will happen.

In the video he said, “I can tell you one thing clearly, that the 2000 rupee notes that are being withdrawn will not have any negative impact on the economy. Moreover, how much of a positive impact it will have on the economy will be known in the future”. An exclusive interview was held by PTI in which he said these words. Further, he highlighted on how the Indian economy can’t step back from dealing with the challenges which are uncertain. He listed out the three most important challenges.

Advertisement

Two to three challenges

In a statement he said, “two to three challenges will be there. One of which is international uncertainty. Uncertainty, that has been caused due to war. The international tension due to war is still going on and it has not stopped yet. What will be the spillover due to this war on other countries, only time will tell us. The another uncertainty is that there is a forecast of El Nino and we don’t know how severe it’ll be. Other than that, there are weather related issues that typically decide the value of vegetables and fruits. These are all some uncertainties that we have to deal with”.

Moreover, the RBI has taken several steps like increasing the policy rates in a calibrited manner. Other than that, the inflation has now decreased and gone below 5%. Shaktikanta stated that the inflation right now is 4.25%. Meanwhile, RBI while announcing withdrawal of rupees 2000 note, urged people to exchange or deposit the notes at their nearest bank branch.

Advertisement