Demonetisation cost Rs 1.28 lakh cr |
The transaction cost of the demonetisation exercise during the 50-day window till December 30 would be a staggering Rs 1.28 trillion (Rs 1.28 lakh crore), according to a study by the Centre for Monitoring Indian Economy. Mahesh Vyas, the managing director and chief economist of CMIE, said the exercise can only be considered worth if the government is able to unearth unaccounted cash worth at least the transaction cost. If the government succeeds in unearthing even Rs.4 trillion unaccounted cash, then the transaction cost of this exercise would be about 26 per cent. Households will bear 12 per cent of the entire cost , largely in loss of wages, during the 50-day period while banks will suffer “overheads and operational costs in terms of recalibrating ATMs. Banks would bear a cost of Rs 351 billion during this stipulated period. Enterprise sector stands to suffer the most out of this exercise, which is aimed at rooting out the menace of black money, as it is projected to lose Rs 615 billion or 48 per cent of the total transaction cost during this period.
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