Modi denies demonetization was a failure

Prime Minister Narendra Modi today denied that the withdrawal of high-value currency notes was a failure.

Speaking in the lower house of Parliament today, Modi said demonetization has created a money trail that can be used to ‘bring everyone into the mainstream’ of taxation.

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“You know how it used to be in the old days.. Income tax officials would go on raids and you know what would happen then. I don’t need to give historical details,” said Modi.

“With demonetization, there is a clear trail — what came from where, who deposited and so on. Now, all that the tax officials have to do is send an SMS saying ‘please tell us from where this (money) came. No inspections, no raids,” he said.

“We have already taken the top names (of depositors) via data mining,” he added.

Modi was responding to charges by the opposition that the amount of money that people deposited in their bank accounts was more or less equal to the total currency in circulation, and therefore the demonetization as a measure was a failure.

The Congress Party also pointed out that black money exists in form of gold deposits, real estate and so on.

Modi said he was glad that the Congress realized that there is a lot of black money in real estate and gold.

“I am very happy that you know this. My question is, when did you realize this,” he asked, adding that the Congress Party refused to have ratify a law that sought to criminalize benami property (benami property refers to property bought in other people’s names to evade detection by tax authorities).


Modi continued to push his image as a ‘gareed friendly’ person. He said the country, under the Congress Party, has seen the emergence of a class of people who profit by taking away what rightfully belongs to the masses.

“I want to assure you that it is not possible going forward. What belongs to the poor must be returned (to them),” he said.

Overall, Modi’s speech in the Parliament — which came after months of demands by the opposition — was sharper than expected and hit the opposition, particularly the Congress Party harder than it was expecting.