‘No role for Finance Panel in according SCS to States’

Black and white money changes colours in India, says former RBI governor.

Published: 08th January 2017 04:29 AM  |   Last Updated: 08th January 2017 04:29 AM   |  A+A-

Fourteenth Finance Commission Chairman YV Reddy participating in a discussion on ‘Understanding Money’ at the Book Festival in Vijayawada on Saturday | Express

By Express News Service

VIJAYAWADA: Former Reserve Bank of India (RBI) governor and 14th Finance Commission Chairman YV Reddy said the Finance Commission has no role in recommending special category status to any State.
Participating in a panel discussion on ‘Understanding Money’ at the 28th annual Vijayawada Book Festival here on Saturday, he said the issue of special category status lies in the hands of the Union Government.

The Centre will take a decision on the basis of the recommendations of the National Development Council, which in turn would act on the recommendations of the Planning Commission. However, the Planning Commission does not exist anymore. So, the Finance Commission does not have any role in the issue, he said.

Speaking on ‘Understanding Money,’ he said people have to prove the source of the money deposited in the banks after demonetisation of higher value notes and they will be held accountable for it.

However, the former RBI governor refused to comment on demonetisation saying that he did not have complete information. He said the demonetisation is only a beginning and it is too early to give an opinion on it.

He said identifying which is white and which is black money is difficult in the country as money changes from white to black and vice versa several times in a day. He also found fault with the loan waivers and said they will impact the economy adversely.


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