Volume of trade will grow, paper currency will shrink after note ban: FM

New Delhi: Speaking at a media event in New Delhi on Friday, Finance Minister Arun Jaitley said that the volume of trade and business will grow after demonetisation, but the amount of paper currency will shrink.

Jaitley however, said that impact of demonetisation on Gross Domestic Product (GDP) is hard to estimate at present. However, he added that he expected the GDP to grow at a higher pace within a year's time.

“A bit of difficulty can be expected at this stage. But the disruptions cannot be overrated; there would be huge advantages in the long run,” Jaitley added.

Thanking people for cooperating with the government in the move to ban old Rs 500 and Rs 1000 notes, Jaitley said it is a challenge for the government to keep the printing of notes a secret.

Responding to a query on why there seemed to be less of new 500-rupee currency in the market as compared to the new Rs 2000 currency notes, the Finance Minister said that printing of higher denomination notes takes half the time taken for printing lower denomination notes.

On impact of demonetisation on the economy so far, Jaitley asserted that while the automobile industry was experiencing mixed trends, rabi crop sowing was higher than that of last year.

“India is likely to continue to be fastest growing major economy in world just as last year,” Jaitley stated.

If you need to replace 86% of a country's cash currency, you have to have a substantial part ready, said Jaitley, however adding that there will be never so much paper currency in circulation in future as there was on November 8, the day before demonetisation came into effect.

Once the remonetisation process is completed, it will hugely impact Indian businesses and way of life, Jaitley asserted.

Pushing for digitisation of the economy, Jaitley claimed that it is inevitable as ‘you cannot stop the advance of technology’.

On Goods and Services Tax (GST), the Finance Minister stated that while every person today gets assessed thrice, under GST, he would be assessed only once.

Taking a jibe at the Opposition which has been protesting against demonetisation in Parliament, Jaitley said the 'retrograde' position they had taken 'completely suits' the government.

Asked about the election of Donald Trump to the US Presidency, Jaitley said India would have to accept the mandate and work with him.