Former prime minister Manmohan Singh came to Reserve Bank of India Governor Urjit Patel’s rescue when the latter was being questioned by the Parliament Standing Committee on Finance on Wednesday over the demonetisation drive. In the past, Manmohan Singh has been very vocal with his criticism of the Centre’s decision to demonetise Rs 500 and Rs 1,000 currency notes. Patel, who appeared before the committee with other RBI officials, was unable to answer questions, such as, when would normalcy return in the banking system, or how much of the banned currency was deposited with the central bank since Rs 500 and Rs 1,000 notes were scrapped on November 8, PTI reported.
Committee member and senior Congress leader, Digvijay Singh, asked Patel whether chaos would break out if the existing withdrawal caps were removed, reported NDTV. “You should not reply to that query,” Manmohan Singh reportedly advised Patel. The RBI on Tuesday had announced that the daily limit for withdrawing cash from ATMs was raised to Rs 10,000 from Rs 4,500.
Before the questioning began, Manmohan Singh, a former RBI governor and finance minister, is believed to have told the committee members, including some of his Congress colleagues, to respect the prestige of the RBI and its governor’s position, PTI reported. Patel is also expected to appear before the Public Accounts Committee on January 20 where he will once again be grilled over demonetisation.
The session went on for four hours on Wednesday where Patel, other RBI officials, and a few finance ministry officials were questioned. When Patel was asked about the emphasis been given by the Centre on cashless economy, he replied, “The demand will be met with the supply and this is the prerogative of the Reserve Bank of India,” reported DNA. Patel could be summoned again during the Budget Session or after it because a number of questions remained unasked, the English daily reported.
On November 24, Manmohan Singh while speaking in the Rajya Sabha had termed demonetisation a “monumental management failure”. Recently, while speaking at the Jan Vedna Sammelan in New Delhi on January 11, Manmohan Singh said demonetisation had hurt the country very badly and “the worst is yet to come”.
In a bid to tackle black money, counterfeiting and corruption, Modi had announced that Rs 500 and Rs 1,000 notes would no longer remain legal tender. The Modi government has been trying to promote cashless transactions in the country to tide over the cash crush created by demonetisation.