Mr Parag blamed the bureaucratic system of governance, improper rules and policies of businesses for black money in the economy. He added that to eradicate black money from the system, the government would require to tackle red money first and along with that implement structural reforms. Talking about tax evasion through investments in tax havens, he said that the government will soon be coming up with tax laws in the coming financial year.
Due to demonetization, there has been an increase in the deposits to the bank, increasing the interest expense of the banks. This has lead to banks investing in government bonds to cover their spread, eventually increasing the funds with the government which would be spent for development of the economy, he said. In the end, Mr Parag touched upon several other topics like economic crises of 2008 and inflationary measure RBI can take in near future. With a lot of KT, it was a great session.
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