New Delhi: Railway Minister Suresh Prabhu has said the demonetisation move will eventually help improve the country`s tax administration and stressed the Railways was not adversely impacted by it in any manner.

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"If you have read the comments of the Prime Minister (Narendra Modi) and Finance Minister (Arun Jaitley) over... the last two years carefully, they have been highlighting this point all the time that we want to improve the tax administration so that the honest tax-payer does not have to worry," Prabhu told BTVi in an interview.

He said there would hardly be any interface between the tax administration and the tax-payer and most of the work will happen through online channels. "That is the philosophy."

On November 8, 500- and 1,000-rupee notes ceased to be legal tender, and new Rs 500 and Rs 2,000 notes were introduced into the system.

Asked about the impact of demonetisation on the Railways, considered the lifeline of the country, Prabhu asserted there would be no impact, not even in the short term.

"I don`t think there will be an adverse short-term impact... at best, people are just trying to guesstimate. But I don`t think there is empirical evidence or any data to suggest that there will be short-term impact."

He said there was a decline in freight volumes but that had nothing to do with demonetisation. "Coal movement has gone down, cement and steel have also slowed down. I will not attribute (it) to the demonetisation."

Praising the digitisation efforts of the government in various sectors, Prabhu said that 58 per cent of rail travellers use information technology to book tickets.

"There are 23 million passengers who travel by Railways every day. Look at the profile of the people, either middle class or the poor. For them, this is the only means of transportation. And they are booking tickets through the internet."

Brushing aside criticism of demonetisation, Prabhu said once the "black money issue is properly addressed" and people "start on a clean slate", the government "will support good business to progress. The tax administration will only collect taxes which are legitimately due and through a proper system."

"The GST (Goods and Services Tax) is also coming, so there will be more and more information technology-based activities. Same thing can happen in income tax over a period of time."

Asked whether the government needs to pump in money as stimulus for the economy, Prabhu said: "We should always do that because we have seen, over the last few years, private investment is significantly lower. Private companies that have made investments have not been able to fully use their installed capacity. Therefore, there is a need to put in more investment."

Saying such government spending is already underway, the minister said: "We need (a) trillion-dollar investment in infrastructure in the next three to four years. It is very interesting (that) China has got over-capacity, but in most of the global markets, the capacity-utilisation is not full."

"This is also something which is in line with our Prime Minister`s thinking that wherever there is a gap, the government should step in and try to increase the spending," Prabhu added.