Hailing the Indian Government’s decision to ban `500 and `1,000 notes, former RBI Governor Duvvuri Subbarao has said it would be a positive move for investment and will result in disinflation. “Given the scenario, my own view is that it is going to be good,” Subbarao, said. It would be positive for investment and result in disinflation among other benefits, he said, while commenting on the Government’s decision to demonetise high value currencies last week. Importantly, it would be good for bankers to encourage people to move from hard cash to electronic transactions.
It would move from a cash-intensive economy to a less cash-intensive, he said, while speaking at MintAsia’s Global Banking Conclave 2016 held in Singapore on Tuesday. But Subbarao also stressed the importance of following up with tougher measures on currency management and not to allow the built up of ‘black money’ again. NRIs have also welcomed the Government’s decision on note ban. Dinesh Khara, managing director for associates and subsidiaries at the State Bank of India (SBI), the country’s largest financial institution said, ‘It is short-term pain but long-term benefit’.