India's demonetization move will be studied by other countries, will have positive impact on economy: World Bank CEO

While several economists and politicians have criticised Prime Minister Narendra Modi's demonetization move, World Bank CEO Kristalina Georgieva has expressed that it would have a positive impact on the Indian economy.

“While demonetization has, in the short term, created some impact on businesses dependent on cash, in the long term the impact will be positive… The reforms India is targeting are profound," Georgieva told Hindustan Times.

She also said that the move would help foster a clean and digitised economy and that its impact would be studied by other countries.

Stating that the growth projection for India for this year is 7%, she said that India is the bright spot in today’s global economy.

On Tuesday, the government pegged GDP growth at a higher-than-expected 7.1% for the current fiscal despite note ban with agriculture sector doing exceptionally well, helping India retain the tag of world's fastest growing major economy.

Georgieva, who was in India for two days, met with senior leaders and also travelled in a Mumbai local during her first official visit to the country. She also visited a school serving low-income households in Dharavi and interacted with students, teachers and parents. The newly appointed CEO of World Bank then met children with special needs.

On November 8, Prime Minister Narendra Modi announced demonetization in a bid to rein in black money from the system.