NEW DELHI: The demonetisation exercise has come with a cost to the government. “Operational expenses in cost of printing new currency and the associated logistics of collecting old notes is likely to have gone up ” said Saugata Bhattacharya, chief economist at Axis Bank. Also, throughout the year the reverse repo has been high that means that RBI has to pay to banks. In the Budget it was assumed that around Rs 75,000 cr would come from RBI, PSBs and FIs compared with a little over Rs 76,000 cr in FY17. if other conditions remain unchanged, the fiscal deficit can increase from 3.2 per cent to 3.4 per cent this year” said Sabnavis

Source: Economic Times August 10, 2017 13:47 UTC