In an apparent defence of the government’s demonetisation decision, RBI Governor Urjit Patel Tuesday told lawmakers that the note ban’s impact was transient and the economy is robust, sources said. Patel, who appeared before the Parliamentary Standing Committee on Finance, would give written responses on some of the controversial issues raised by the members, including the government citing never-used powers to get the central bank on the discussion table, said MPs who were present in the meeting.
Making a presentation on the state of the economy, the governor said the economy would get a boost from oil prices cooling off from four-year highs and asserted that the fundamentals were “robust”. Urjit Patel was earlier scheduled to appear before the panel on November 12.
Former prime minister Manmohan Singh is also a member of the committee headed by senior Congress leader and former Union minister M Veerappa Moily. The RBI governor, however, did not answer specific questions on the government considering using Section 7 of the RBI Act, NPAs, the autonomy of the central bank and other contentious issues, sources said.