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RBI Guv compromised institution’s integrity: Chidambaram on note ban

RBI Guv compromised institution’s integrity: Chidambaram on note ban

New Delhi: Hitting out at RBI Governor Urjit Patel, former Finance Minister P Chidambaram on Monday said he was “extremely disappointed” that the central bank chief did not handle the demonetisation issue as any “independent autonomous institution should have”.

“I am extremely disappointed that Mr Urjit Patel did not handle this matter (demonetisation) as any independent autonomous institution should have handled,” Chidambaram said in an interview.

RBI, he said, compromised its independence and integrity which were acquired over the years under different governors.

He regretted that Governor Patel was “steamrolled” into calling the RBI’s Board meeting at 5.30 pm on November 8 and “told to send the recommendation within an hour”.

“I want to see the minutes of that RBI meeting. Why is the RBI unwilling to disclose those minutes? I want to know who attended the meeting, what was discussed there, were there any voices of dissent, what was the information placed before the RBI Board.

“Equally, I want to know what are the numbers contained in the Cabinet Note that was placed before the Cabinet at about 6.30 that evening. How can you have a command performance like this? 5.30 (pm) RBI Board meets, 6.30 (pm) Cabinet meets awaiting the recommendation of RBI. This is all pre-scripted…,” the former finance minister said.

Chidambaram further said that he was “equally disappointed” that Patel does not speak up and has spoken exactly once in the last 40 days.

He added that none of the key players – Finance Secretary, Financial Services Secretary and Chief Economic Advisor – too have spoken on the issue.

The senior Congress leader also said demonetisation does not have any impact on black money generation, and government has tacitly agreed to this as well.

Chidambaram said black money is being laundered and there is simply no machinery to scrutinise both Jan Dhan and non-Jan Dhan accounts.

He said the remonetisation process will take at least 6-7 months, and the situation is not going to normalise before April even if the government floods the market with new Rs 2,000 notes.

Chidambaram also said a completely cashless economy means maximum information with government and an end to privacy. He, however, advocated that high value transactions must be digital.