Cash Crunch: As The ATMs Go Dry In Some States, Arun Jaitley Puts Up A Brave Front
Arun Jaitley said there is more than adequate currency in the country The government said the currency supply rose by Rs 45,000 crores Government concedes that there some states that have more currency
The ghost of demonetisation seemed to return to haunt a part of India early this week when the ATMs (automated teller machines) of seven states that include Karnataka, Maharashtra, Andhra Pradesh, Rajasthan, Uttar Pradesh, Madhya Pradesh and Telangana, reportedly faced shortage of cash, engendering a situation of #cash crunch in the parts of country. Seizing an opportunity, some opposition leaders didn't refrain from blaming the centre for the cash crunch. West Bengal chief minister Mamata Banerjee, tweeted, "Seeing reports of ATMs running out of cash in several States. Big notes missing. Reminder of #DeMonetisation days. Is there a Financial Emergency going on in the country?"
Also, famous author Chetan Bhagat, in his characteristic witty style, remarked, "There used to be dry days for alcohol. Now there are dry days for cash."
The government, in a press release, clarified that there has been unusual spurt in currency demand in the country in last three months. In the current month, in the first 13 days itself, the currency supply increased by Rs.45000 crores. This unusual spurt in demand is seen more in some parts of the country like Andhra Pradesh, Telangana, Karnataka, MP and Bihar, reads the statement.
The criticism and the reported inconvenience notwithstanding, Union Finance Minister Arun Jaitley assured that there is "more than adequate" currency in circulation and the temporary shortage in certain states is being "tackled quickly".
Jaitley said in a tweet that he has reviewed the currency situation in the country.
Shiv Pratap Shukla, Minister of State for Finance, also echoes the same sentiments as Jaitley's. Shukla said, "We have cash currency of Rs. 1,25,000 crore right now. There is one problem that some states have less currency and others have more. The government has formed state-wise committees and the RBI has also formed a committee to transfer currency from one state to other. It'll be done in three days."
Also Read: Cash Crunch "Temporary", Says Arun Jaitley, Empty ATMs Reported: 10 Points
It is surprising to note that all this happens while the RBI report shows that the currency in circulation has already hit the pre-demonetisation level of about Rs 17 lakh crore.
The State Bank of India said it was wrong to call it a currency shortage. "In certain geographies, the demand for cash is more. The demand is up in the procurement season," said the bank's chairman Rajnish Kumar
At the same time, chief minister of Madhya Pradesh, a BJP-ruled state, Shivraj Singh Chouhan alleged a conspiracy behind Rs. 2,000 notes vanishing from the market. While addressing a farmers' convention, he said, "The currency worth Rs. 15,00,000 crore was in circulation before demonetisation. After the demonetisation exercise, the currency in circulation increased to Rs. 16,50,000 crore. But notes of Rs 2,000 are missing from the market."