Demonetisation did not affect J&K much: finance minister Haseeb Drabu

Haseeb Drabu said the people of J&K have got used to certain distress situations, so they stock cash when the banks are not open during long strikes


J&K finance minister Haseeb Drabu. Photo: AFP
J&K finance minister Haseeb Drabu. Photo: AFP

Jammu: Stating that the main banks in the state managed demonetisation well, the Jammu and Kashmir government on Wednesday said the note ban did not have any negative effect on the state and instead it helped bring down prices of the real estate which had once gone beyond reach.

“I don’t think that the demonetisation has had any effect as it has been managed very well by the principle banks and I would complement J&K Bank for that,” finance minister Haseeb Drabu told reporters after presenting the state budget on Wednesday.

He said that the people of J&K have got used to certain situation of distress and when the strike is for five months and banks are not open so they stock cash, when there is uncertainty in the overall system then people take measures to keep cash so the transactional demand is very high.

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“Also there is a lot of community banking in J&K and the number of people are very small 1.25 crore people, it is not like Bihar and UP and I think we have managed the demonetisation part very well as far as personal finance go.”

“I think the principle impact of demonetisation on the economy of J&K has been to soften the land rates. I think that is a big thing as you would find that there was an asset price bubble in the system where your assets like the house and land was way out of line with the other assets. I think that has soften that and I think that is a good thing that has happened”, he said.

He said that was one single point in this budget which is how to improve the efficiency of spending, how can be spend well. “Every year we spend thousands of crores like this year we are spending around 75,000 crores. Does it get reflected on the ground and if does not then why does not it because there is inefficiency in spending”, he said.

He said that the principle focus of this budget is to build system processes so that the state can spend the money efficiently, usefully for the entire state and showcase a certain degree of progress and that is the key theme of the budget.

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