Demonetisation 'once in a lifetime event', says RBI Governor Urjit Patel

Terming demonetisation as a "once in a lifetime event" that requires mammoth logistics, Governor Urjit Patel has said that the Reserve Bank of India is taking all necessary actions to "ease the genuine pain of citizens who are honest and who have been hurt" and hoped things will normalise at the earliest.

Speaking for the first time after the decision to withdraw old Rs. 500 and Rs. 1,000 notes, Dr Patel who has been facing criticism for keeping silent, also said the situation is being monitored on a daily basis while printing presses have started to re-balance the production of new notes towards Rs. 100 and Rs. 500 bills.

Giving details of the steps being taken by RBI, he said, "Both RBI and government have been getting the printing presses to work at capacity to get the new notes available to meet demand.

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"RBI is interacting with the banks every day. They are telling us that the situation is gradually easing. The queues in branches and ATMs are shorter and the markets are starting to function, and there are no reported shortages of daily items of consumption.

"Also, about 40-50,000 people were deployed to refit the ATMs. Currency is available and banks are working in a mission mode to lift currency and take them to their branches and ATMs. The staff members of all banks have worked very hard, and we all owe them our gratitude," Dr Patel said.

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On why there have been long queues and a reduction in trade and business, Dr Patel said, "This is a once in a lifetime event. It is very rare to remove 86 per cent of the currency in circulation in one go. The logistics of such an operation is mammoth.

"And yet for withdrawal of legal tender status to be effective, complete secrecy was required. So, it is difficult to get all banks ready and fully prepared in 24 hours for a big step like this. Obviously, this has caused some dislocation. That is why we request support from all Indians for the larger cause of fighting tax evasion and the black economy," he said.

Against the backdrop of criticism directed against Dr Patel, Finance Minister Arun Jaitley earlier today said it is an "unfair attack" and politicians should refrain from making comments on those who cannot defend themselves.

"An unfair attack by Jairam Ramesh on the RBI Governor. Must politicians attack those who can't defend themselves in the same tone?" Mr Jaitley said in a tweet.

Congress spokesperson Mr Ramesh had alleged that Dr Patel is either guilty of misleading the nation about RBI's preparedness on demonetisation or has sacrificed the autonomy of RBI.

"Either way, he should resign," Mr Ramesh had said.

On Saturday, Law Minister Ravi Shankar Prasad said the decision to scrap Rs. 500 and Rs. 1,000 notes was taken by the government on the recommendation of RBI.

--PTI