Reserve Bank of India Governor Urjit Patel on Wednesday told a Parliamentary Standing Committee on Finance that Rs 9.2 lakh crore of new currency notes have been put in circulation since the high-value currency notes were demonetised on November 8.
“When asked how much had been remonetised, he (Patel) replied that more than nine lakh crore has been remonetised,” Trinamool MP and Standing Committee on Finance member Saugata Roy said after panel met with the RBI Governor.
“The Governor explained that the government had advised the RBI to consider demonetising high currency notes. The board had a discussion and took the decision,” Roy said.
“When asked how much of the total demonetised currency returned to the bank, he said he could not give the figure right now as the process was still on,” he added.
According to the opposition member of Parliament, Governor Patel was also “unable to tell us when the system will be normal…the RBI officials were defensive.”
Secretaries of all departments in the Union Finance Ministry as well as bank associations’ representatives were present at the meeting of the committee headed by Congress MP Veerappa Moily.
On November 8, Prime Minister Narendra Modi announced the demonetisation of high-value currency notes, saying the move was aimed against black money, counterfeit currency and terror funding.
The RBI has still not declared how much of the Rs 15.44 lakh crore in banned notes has been returned to the banks.
Prior to this, an estimate of new notes could only be gleaned from the RBI’s weekly figures on “currency in circulation”.
The first time the RBI spoke of a break-up of new notes was on December 7 during the monetary policy press conference. Deputy Governor R. Gandhi said that a total of Rs 4 lakh crore in new notes had been circulated till December 6, of which 19.1 billion notes (which amounts to Rs 1.06 lakh crore) were in small denominations of up to Rs 100 and the rest (Rs 2.94 lakh crore) were in high denominations of Rs 500 and Rs 2,000.
On December 19, the RBI again gave a figure of new notes circulated. It said 20.4 billion small denominations (up to Rs 100) and 2.2 billion of high denominations (Rs 500 and Rs 2,000) had been circulated. This was equivalent to a total of Rs 5.93 lakh crore.