New notes' stock was ready before demonetisation: RBI

New Delhi : The Reserve Bank of India (RBI) has said that it had a reasonable stock of new Rs 500 and Rs 2,000 currency notes in place before the announcement of demonetisation was made on November 8, 2016.

 

This was revealed by RBI Governor Urjit Patel to the Parliamentary Standing Committee on Finance earlier this week.

"The arrangement for printing of new notes of Rs 2,000 and Rs 500 was started months back taking into the account all critical factors. By the date of the announcement, reasonable amount of new designed notes had already been printed and kept ready," Patel said in a written submission to the committee.

"Critical factors, such as installed capacity for printing and other resources viz availability/expected supply of inputs, like bank note paper, ink, logistics requirements etc were factored in and was shared and discussed with the government periodically, in order to lessen the inconvenience for the public," he said.

As on November 8, there were 17,165 million notes of Rs 500 and 6,858 pieces of Rs 1,000 in circulation, aggregating Rs 15.44 lakh crore, the Governor informed the parliamentary panel.

While keeping the "secrecy in mind", Patel said discussions on the measure had started in early 2016 between the government and the RBI when his predecessor Raghuram Rajan was the Governor.

 

However, no records of discussions between the central bank and the government on demonetisation were maintained because of secrecy, he added.