Demonetisation Will Transform Indian Economy, Says RBI Governor Urjit Patel 

Dr Urjit Patel (PUNIT PARANJPE/AFP/GettyImages

On the eve of the deadline for citizens to deposit demonetised currency in banks, Reserve Bank of India (RBI) Governor Urjit Patel said that demonetisation will have a transformative effect on the economy going forward, despite some short-term disruptions and "public hardship".

"The withdrawal of specified bank notes will impart far-reaching changes going forward. It is expected to significantly transform the domestic economy," Patel said on Thursday in his foreword to the half-yearly Financial Stability Report.

He said the increasing adoption of digital modes of payments will lead to greater intermediation, efficiency gains, accountability and transparency. Patel acknowledged that demonetisation of high-value currency has caused short-term disruption and hardship.

On the domestic macroeconomic front, condition remains "stable" with a cool-down in inflation, the RBI Governor said, adding that the growth momentum has "slackened" recently.

With inputs from IANS

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