Category Archives: Demonitization 2016

Demonitization-Gurumurthy Take

Gurmurthy piece in The Hindu

His contention:

The balloon of HDN was expanding in dangerous proportions. This needed to be reined, otherwise Indian Economy was doomed by 2021. This was a reset.

The growth during UPA years was jobless growth powered by HDN, via high asset price and high private consumption.

Interestingly he faults Govt late introduction of Income declaration scheme late in the day, otherwise this could have fetched 2-3 lacs Cr in tax.

Now he states 45K Cr is black money is already unearthed and 2.9 lacs Cr in under scanner, the yield is far more than any earlier income declaration.

Following demonetisation, there are 56 lakh more assessees, advance tax receipts have gone up by 42% and self-assessment tax risen by 34%. It has also led to an attack on benami assets. Even as intelligence agencies note a 50% drop in hawala-related calls post demonetisation, nearly 2.24 lakh shell companies that have been used for hawala have been uncovered; 35,000 have been found laundering ₹17,000 crore; one of them, ₹2,484 crore.

Everyone has their numbers.

 

 

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UPA real growth Story

Rajiv Gowda, a professor at IIMB, and a Congress Rajya Sabha articulates in The Hindu, what is the real story behind the growth in UPA.

The story started when previous PM Dr Manmohan Singh, penned a article in The Hindu expressing his concerns on demonetization. S. Gurumurthy, RSS ideologue, published a rejoinder to same, that it was growth of now demonetized money which fuelled the growth. This also fuelled corruption and black money, he argues.

  • In the present of article Prof. Gowda argues:
  • Growth was real
  • The growth in asset price and gold and stock market was in line with norms.

All the three articles are very nice reads.

 

 

Unravelling the mystery behind Rs 3-lakh crore deposits in 15 days

Business Standard

As we go in Post-Demonitized India, Conspirasy theories are bound to follow. But some raise the issue, which warrant further investigation.

Ishan Bakshi & Nitin Sethi has filed this report in BS. The 3-lakh crore deposit in a fortnight is unprecedented and so is withdrawl of 1.2 lakh crore in the following fortnight.

RBI consent in demonitization

In the present days of modern monetary system, independence of Central banks is given paramount importance. FED, ECB every single one has guarded this independence tooth and nail. Demonetization of 85% of currency takes some nerves, just too much risk is involved. Which raises question how much was the involvement of RBI in it. Media states on six people knew about it, RBI governor and ex-governor (erstwhile governor)  from RBI knew of it. Which means it never reached the board. This makes is much more murkier. Dr Rajan and Dr Subbarao put everything inline to protect this independence. I wonder how much is it now. It almost seems North Block is running RBI. Shaktikant Das is making all the announcement, Dr Urjit Patel is not be seen anywhere. Ex- Dy Director KC Chakrabarty spills the beans further. This was proposed during UPA-II time, but was rejected and did not reached the board state.