Demonetisation type cash crunch hits ATMs; Arun Jaitley reacts, says shortage temporary
Demonetisation type cash crunch hits ATMs: West Bengal Chief Minister Mamata Banerjee said it reminds her of the demonetisation days. She wondered if a "financial emergency" is going on in the country.
Finance Minister Arun Jaitley on Tuesday said there is "more than adequate" currency in circulation and the temporary shortage in certain states is being "tackled quickly". The statement comes after reports of currency shortage in at least six states -- Gujarat, Eastern Mahashtra, Madhya Pradesh, Bihar, Andhra Pradesh and Telangana.
"I have reviewed the currency situation in the country.Overall there is more than adequate currency in circulation and also available with the Banks. The temporary shortage caused by 'sudden and unusual increase' (in demand) in some areas is being tackled quickly," Jaitley said in a tweet.
Have reviewed the currency situation in the country. Over all there is more than adequate currency in circulation and also available with the Banks. The temporary shortage caused by ‘sudden and unusual increase’ in some areas is being tackled quickly.
— Arun Jaitley (@arunjaitley) April 17, 2018
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, according to a press release by Ministry of Finance.
This unusual spurt in demand is seen more in some parts of the country like Andhra Pradesh, Telangana, Karnataka, MP and Bihar, the press release added.
Commenting on the cash crunch, SBI Chairman Rajnish Kumar told to Zee Business: if there is any geographical imbalance or any imbalance in currency chest between the banks, it will be tackled through more efficient use of cash, while RBI will augment the supply of Rs 500 notes.
On the shortage of Rs 2000 notes, the banker said, "it seems that Rs 2000 notes are not coming back into the system. "I would urge public to return the excess Rs 2000 notes to banks as we have to keep the system running. There is no point public keeping excess cash with them".
Minister of State for Finance Shiv Pratap Shukla said the government has formed a committee to address the problem of currency shortage in certain states and the issue would be resolved in next 2-3 days.
"The Government has set up state-wise committee and RBI has also formed a committee to transfer currency from one state to other because for money transfer you need the permission of the RBI. It (the shortage) will be solved in 2-3 days," Shukla told PTI.
West Bengal Chief Minister Mamata Banerjee said it reminds her of the demonetisation days. She wondered if a "financial emergency" is going on in the country.
"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? #CashCrunch #CashlessATMs," Banerjee tweeted.
— Mamata Banerjee (@MamataOfficial) April 17, 2018
The currency in circulation in the country has reached the pre-demonetisation level of about Rs 17 lakh crore, according to a report by Reserve Bank of India (RBI).
Meanwhile, RBI has formed a committee to look into the cash crunch crisis.
Industry experts feel the shortage has been caused because of cash hoarding of the Rs 2,000 currency notes.
(With inputs from agencies)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.