You played a pivotal role in the decision to weed out black money. When did this idea occur to you?
I’d seen cash being seized from ambulances and police vans during elections and all were Rs 500 and Rs 1,000 notes.I realized that large denomi nation notes was the easy way of storing black money. We saw that more large denominations were getting circulated and it was dangerous.
In 2016, the total currency in circulation is Rs 17 lakh crore and Rs 500 and Rs 1,000 notes account for Rs 14 lakh crore.Let’s see how much will be put back into banks; that’ll tell us the amount of black money.
The quantum of cash an individual can hold should be defined. Today, there is no bar; we’re only monitoring transactions, not how much is stashed at home. The incometax department can raid me only if the money with me is beyond my known sources of income. There should be a restriction on how much cash an individual can have. This should not apply to corporates if their accounts are in place.
The government and RBI would have considered this and there will be safeguards. The Rs 2,000 currency plan has been there for 6-7 months.
We’re already moving away from traditional transactions.Five years from now, I don’t visualise banks; mobile phones will be the banks. The traditional brick and mortar bank will be gone. There will be incovenience initially . Credit rating and monitoring will be easier. In the next 5-10 years, I visualise traders will also adopt modern techniques of transactions.
Approximately 5% -6% of the GDP. Last year, the GDP was Rs 125 lakh crore, so black money would be Rs 6 lakh crore. All this needn’t be in Rs 500 and Rs 1000 notes. It could be in land and gold too. That won’t be revealed through this demonetisation. A substantial amount of corruption is in the government sector; it’s wombto-tomb corruption -from birth certificate to death certificate, we pay bribes.
I hope that’ll be the next focus.I should be able to account for my money in Swiss banks.There should be a law where any money kept by an Indian citizen in a foreign bank belongs to country if she cannot explain the money source.
What is the target -black money, fake currency or terror funding?
All three. Law-abiding, middleclass citizens should not panic.It’s aimed at political parties and government servants with ill-gotten wealth. We must have patience and join hands with the government in cleansing public life. We must stop being cynical.