Note ban likely to fetch government Rs 2.5 lakh crore: KV Kamath

A conceivable Rs 2.5 lakh crore fortune for the government, a lower loan fee administration for a delayed period, better duty consistence, and recapitalisation of battered state-run banks are among the advantages that Prime Minister Narendra Modi's demonetisation move will convey, previous ICICI Bank executive KV Kamath said. Moving to computerized exchanges will help the administration track the stream of assets through enormous information investigation and the measure of cash available for use would be compacted generously, the Brics bank boss told ET in a meeting.

"This move was expected to address the issue of debasement in the nation… To me, different issues regarding fake cash are critical however auxiliary," said Kamath, the champ of ET's Lifetime Achievement Award during the current year.

"On the off chance that the diversion is likewise to pack the measure of money available for use, and move things carefully, I think the government winds up grasping a lot of cards." Interest rates ought to decay by as much as 100 premise focuses over a six-month time span, he said. A premise point is 0.01percentage point. "There will be an effect on loan charges and expansion. At last, that is the thing that drives the economy," Kamath said.

"I trust that in the event that we have the patient in great condition after this workout, the patient ought to do well for a drawn out stretch of time," Kamath said.

Many would be slanted to store money as a result of the late acquittal plot under which those holding undisclosed money would need to pay half assessment. As much as Rs 2.5 lakh crore may come into government coffers by the method for assessments, he said.

Kamath, 69, who was assigned in 2015 as the primary executive of the Shanghaibased New Development Bank — a joint wander off the Brics countries — said the stunning treatment would likewise reinforce loan specialists.

Just a fearless pioneer could have made such a stride, he said. "It takes gigantic mettle and a predisposition towards activity to do this," Kamath said. "That fearlessness our PM has."

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