Economic activity hit owing to shortage of currency

new Rs. 2000 noteThiruvananthapuram: Economic activities continues to suffer on account of the failure of banking system to pump in enough new currency notes after demonetisation of Rs. 500 and Rs. 1000 notes.

Sales were diminished in retail markets where much of the sales were based on cash. Even those in possession of the new Rs. 2000 notes could not buy things as retail outlets did not have change.  Vegetable and fish venders were hardly hit owing to drop in sales.

The shortage of currency notes was accentuated because most of the ATMs did not function in the State. Large queues formed in front of ATMs that functioned (mostly those located at bank branches).

Two people died in Kerala while waiting to exchange cash at banks. While one of them collapsed while waiting in a queue, other was found to have fallen down from an upper floor of a bank at Thalassery.

Police had to discontinue booking people for traffic violations as people did not have cash with them to pay fines. Police could not also pay balances for Rs. 2000 notes.

Attendance was thin in government offices in the morning on Thursday and Friday as staff had gone to exchange notes in banks. Officials had to get money during banking hours as ATMs did not function.

Meanwhile, Reserve Bank of India has directed that railways, airlines, petrol pumps, milk booths, pharmacies, KSRTC and utilities could accept demonetised notes as payment for four more days.

At the same time, the debate over black money being parked in cooperative banks intensified with BJP claiming that the black money with cooperatives amounted to Rs. 30000 crores.  The LDF maintained that the Centre was trying to stifle the cooperatives.