Thread by @amishra77

RBI has come with an excellent paper on the benefits of #Demonetisation - with undeniable facts and data and not rhetoric that has been offered by newly minted economists or stale shayari from the Congress stable. Consider some facts in next few tweets.1/10

Currency in circulation (CIC): CIC was down by 8% Y-o-Y as against 17.2% rise in previous year. So as of 27th Oct 2017, CIC was around 91% of pre-demonetization levels and actually 81% if same growth rate had continued in absence of demonetization. 2/10

Currency in circulation as proportion of broad money (M3) fell to 12.3% on 13th Oct 2017 as compared to 14.4% on 11th Nov 2016. The conclusions in RBI paper are thus significant. 3/10

What happened to bank deposits due to Demonetisation? This is the aggregate deposists of scheduled commercial banks in India. Look at the value on 11th Nov 2016 and now. Jan Dhan accounts had laid the ground work formalize these vasts sums. 4/10

In terms of actual numbers, this is what the RBI report says on effect of Demonetisation on deposits growth. What will be the impact of this? It is formalization of savings and their channelization into capital markets. 5/10

Actually formalization of savings and investment into mutual funds, a very healthy sign, is already happening and as data shows, a structural shift has happened which has sustained. 6/10

Not just mutual funds, but the total inflows of first year premium for life insurance has been witnessing a sustained growth. In Nov 2016, large sums were again channelized into formalized savings. 7/10

On of the greatest benefits has been the structural shift towards a less cash society. Consider the overall chart or just this- in Aug 2017 - 16.8 million BHIM transactions; in Oct 2017 - 77 million. This is happening a year AFTER demonetization. 7/10

Another benefit of demonetization that you may already be experiencing in form of lower EMIs? Here is why it happened and when it happened. (from story by @the_truepicture ) 8/10

Finally, let conclusion of the RBI report on #Demonetisation speak for itself. Remember, this is RBI report and not some newly minted economists who are saying this. 9/10

Not in too distant a future, but in just about a year to two, we would record the twin effects of #Demonetization and GST as THE greatest economic reforms in India. 10/10