He claimed that the Rs 2,000 notes may not have been in circulation much now as they have been hoarded by people.
"A good chunk of Rs 2,000 notes are actually not in circulation, having been hoarded. The Rs 2000 note, therefore, is not presently working as a currency of transaction," Garg said.
The former IAS officer has, therefore, suggested to outlaw the high-value notes.
"A simple method, depositing these notes in the bank accounts (no counter replacement), can be used in managing the process," the former bureaucrat said in a 72-page policy prescription for India to become $10 trillion by 2030.
As per his estimate, the Rs 2,000 bank notes account for about one-third of currency notes in circulation in value terms.
The Rs 2,000 notes were circulated by RBI in November, 2016 after demonetisation of Rs 500 and Rs 1,000 notes.
Talking about the cash economy, Garg said the cash is still quite high in the system. Further, there is also stocking of Rs 2,000 note in evidence.
Garg said that expansion of digital payments was taking place all over the world and was happening in India too but the pace was slow.
"The pace is much slower," he said.
Announcing the note ban, the government had said that the move would contain black money and eliminate the menace of fake currency.
( With inputs from IANS )