Supporting the government’s demonetization move, Minister of State for Finance Arjun Ram Meghwal has said that demonetisation of old high value currency and government’s digital push will boost country’s gross domestic product (GDP) and also help to prevent tax evasion.
Further, noting that about 23.2 per cent of the economic activity is shadow economy, Meghwal said that these steps would address the shadow economy and will widen the tax bracket. He added that the demonetisation was in accordance with the general will of the citizens of India towards a corruption free society.
Expressing his concern over the country’s cash to GDP ratio, which is high in comparison to developed countries, as in advance countries, the cash to GDP ratio is in range of 4, while in India it is estimated at 12. He said that the demonetisation and digitisation of payments will also help to narrow this gap.