Business will grow, but paper currency will shrink: Jaitley

After the notes ban, India will have significantly less paper currency than before, finance minister Arun Jaitley said today.

"One of the advantages of this exercise will be that there won't be the same level of paper currency as there was on 8 November," Jaitley told NDTV in an interview. "The volume of formal trade, volume of business will grow but paper currency will shrink."

A year from now, said the finance minister, India will be a larger economy with ''higher GDP, cleaner GDP, reasonable interest rate''.

Jaitley was discussing the impact of the sudden demonetisation of Rs500 and Rs1,000 notes - which formed 86 per cent of the cash in circulation - to crack down on tax evasion and black or untaxed money.

Demonetisation, he said, is the "new normal confronting black money which was the norm in India for seven decades".

On the cash crunch that has led to people waiting for hours at banks and ATMs, the finance minister said, "When we are covering such a large population, there will be queues."

He added, however, that people have cooperated tremendously. "You don't find a social unrest in the country," he said.

Demonetisation will also ensure that political funding becomes "transparent".

"Today each person gets assessed for tax at least thrice. In future, the effort is to simplify and ensure just one assessment," he said, adding, "We are at the cusp of change and the battle between the taxman and the people who try to beat the system will continue."