Highlighting the impact of the demonetisation on reduction of cash transactions, Niti Aayog Vice-Chairman Rajiv Kumar has said that the government is committed to fiscal discipline and added that the Prime Minister resisted the pressure to cut down excise duty on fuel despite rising oil prices.
Rajiv Kumar further said that the note ban has impacted the markets and market psychology and the move has encouraged digital payments. He also underlined that the objective of the note ban exercise was not to have a large number of unreturned Rs 500 and 1,000 notes but to reduce cash transactions and promote digitization.
On the inflation front, Kumar said that retail inflation, which includes fuel and food, is lower than core inflation, adding that inflation is well under control and the government is constantly on vigil on these issues. He also noted that inflationary impact of an oil price rise, or that of minor exchange rate decline is not that high, because there can be a supply response to that.