India Today Conclave Next 2017: Demonetisation like reforms will decide India's future, says Arun Jaitley

Ahead of the first anniversary of demonetisation, Union Finance Minister Arun Jaitley today said every structural reform will have short-term consequences. He was referring to disruptions the country faced after Prime Minister Narendra Modi outlawed old Rs 500 and Rs 1,000 currency notes on November 8, 2016.

While speaking at India Today Conclave Next 2017 event, the Finance Minister said: "Any form of disruption like this can have an immediate effect." He said the effect of the currency ban didn't last for years but weeks. "If the impact had been so huge, the kind of social unrest it would have thrown itself would have been evident. But the process was so strong that the agricultural growth during that time actually went up," Jaitley said.  

FM @arunjaitley on Demonetisation step: Every structural reform needs political courage to shoulder responsibilities. pic.twitter.com/Yo0zmJjgAv

- Ministry of Finance (@FinMinIndia) November 7, 2017

When asked about the total black money detection after the demonetisation, the Finance Minister said: "This will be continouous process. Lets not tie ourselves down to one number. Amongst the individuals who have made deposits, the Central Board of Direct Taxes (CBDT) has been able to identify 1.8 million people. A large number of shell firms have been used as conduits. It's more about the process than the number, as the numbers will keep on varying. Today people are more concerned about the cleaner use of money, which is more important and that's the government's achievement," he added.

FM @arunjaitley : Prompt remonetisation has helped contain the Demonetisation impact on unorganized sector.

- Ministry of Finance (@FinMinIndia) November 7, 2017

The Finance Minister also highlighted how technology and demonetisation changed the way tax professionals used to avoid taxation. He said: "CAs for decades worked on standard procedure on registering shell firms to convert funds. But now with tech instruments at place at the registrar of companies' website, I think even for investigative reporters in media, it is not tough to unravel multi-layering and identify these companies. So, technology plays a powerful role in each sector of the governance."

Arun Jaitley also refuted claim that the windfall profit that the government had expected did not materialise as over 99 per cent of the money after demonetisation came back into the banking system. He said: "Some people try to confuse the demonetisation saying since people managed to put in their money into the banking system, so the initiative failed, but that was the whole idea. You take money into the system that is laundered out in the open. I would say link the demonetisation with spending curbs on cash, thrust against benami properties, and it will direct you towards how India would take its future direction."