Former RBI Governor Raghuram Rajan said on Thursday that he would have resigned if the demonetisation decision was thrust on him but made it clear that the government can bypass the central bank if it wants to push ahead with such a decision.
Asked what he would have done if the government wanted to bring in demonetisation and whether he would have said "No, only over his dead body", Rajan replied the government does not need the RBI's nod and if it still wanted to go ahead with it, "then the only option is - take my resignation".
"It is not fair to answer this question unless you are in that position. Any civil servant, regulator or a central banker...to the extent they have to implement a policy they don't believe in, basically (they) should not be sabotaging the policy because it is for the elected government to do what it wants. The only option is opting out."
Rajan said if the government wanted to implement demonetisation without disruption, then it should have all the currency it wanted to replace from day one.
Asked about his views on the impact of demonetisation on the economy, he prefaced his reply with a caveat that he would be extremely careful about what he would say because the country still did not have all the data.