SAN FRANCISCO (Diya TV) — During a New Year’s Eve address of the nation, Indian Prime Minister Narendra Modi once again defended his efforts of scrapping of high-value banknotes in an effort to combat untaxed wealth, calling the action something that “will play a critical role in shaping the future of the nation for years to come.”
As the 50-day deadline to exchange banned Rs. 500 and 1,000 notes came to an end over the weekend, Modi thanked India’s residents for their patience, discipline and resolve.
The surprise Nov. 8 announcement instantly made 86 percent of the currency in circulation in the country illegal, some 15.4 trillion rupees. An even more drastic measure when you take into consideration India’s rate of cash transactions, about 90 trillion rupees are spent each year in such purchases.
Millions of residents have stood in lines for weeks, attempting to exchange the banned currency for legal tender before the aforementioned deadline arrived. Modi promised the transition would only take 50 days, which ended on Dec. 30. According to the Reserve Bank of India, banknotes worth 5.92 trillion rupees — about 38% of the amount invalidated — went into circulation between Nov. 10 and Dec. 19.
“My effort is to take the banking system to normalcy as fast as possible in the new year,” Modi said in his address.
Modi explained demonetization by using an analogy, describing it as a tussle with dishonesty. “It is historic that both the people and the government are on the same side in this battle against evil,” he said.
The prime minister said that only 2.4 million worth of India’s 1.25 billion people have disclosed an annual income of more than one million rupees.
“Can we digest this?” the prime minister asked during his address. “Look at the big bungalows and big cars around you.”
He also used the time to announce a number of new incentives to benefit the country’s poor, farmers, small traders, elderly citizens and women. Among the new programs is a four percent interest subsidy on housing loans of up to 900,000 rupees taken out in 2017; doubling the credit guarantee small businesses can receive to 20 million rupees; and transferring 6,000 rupees to the bank accounts of pregnant women.
