Sitharaman said that after the demonetisation, the number of stone pelting incidents have come down.
"Because they are really running short of funds, there have been a lot of attempted bank robberies. It clearly shows that demonetisation has affected the flow of funds for terrorism, similarly in left wing extremist affected areas too," said Sitharaman.
Earlier in the day, Finance Minister also praised demonetisation. He said that the demonetisation exercise undertaken a year ago would be remembered as a "watershed moment" in the history of the Indian economy.
Addressing a press conference, just a day before the first anniversary of demonetisation, Jaitley said that the announcement of the note ban was a watershed moment in India's economy. He said that it was important that the government remained undaunted of the criticism, because it was natural for people to be skeptical of new things.
In a blog post on Facebook, Jaitley said the NDA government had taken a number of steps since the start of its tenure to weed out black money and demonetisation was a culmination of those efforts.
Demonetisation was announced on November 8, 2016.