Day 12 of Demonetization, Bank Queues Shorter & Farmers Get More Benefit

By Sarkaritel November 22, 2016 10:26

Day 12 of Demonetization, Bank Queues Shorter & Farmers Get More Benefit

Unreleting crowds at ATMs Despite Restricted Withdrawals

By TN Ashok

New Delhi, Nov 21: The aftermath of governments demonetization move entered the 12th day today with opposition blocking proceedings in both houses, queues at Banks getting shorter but unrelenting crowds lining up at ATMs despite withdrawals being restricted to Rs 2000 per day per person.

Government extended benefits to farmers by allowing them to buy seeds seeds with old currency notes from any state or central government outlets and agri universities ahead of the Rabi harvesting season. Farmers can purchase seeds from the centres, units or outlets belonging to the central or state governments, public sector undertakings, national or state seeds corporations, central or state agricultural universities and the Indian Council of Agricultural Research (ICAR), on production of proof of identity, the finance ministry said in a statement.

The Finance Ministry communiqué said the Modi government stands committed to ensure farmers are suitably facilitated during the Rabi season. Last week, government had announce a slew of measures to benefit farmers by increasing their withdrawal limits to fund their rabi sowing operations.

In Parliament, a united opposition led by the Congress and TMC raised their level of attacks on the government on the after effects of demonetization leading to adjournment of both houses of parliament several times.  In the Lok Sabha, Congress and other parties insisted for a debate under rule 56 which provides for voting and suspension of all other business by allowing adjournment motions. Parliamentary Affairs Minister Ananth Kumar said the government was prepared for any discussion but under rule 193 that did not entail voting or passage of any resolution.

Finance minister Arun Jaitley told the Rajya Sabha Monday that the opposition did not appear to be ready for any debate but was merely inventing newer techniques to disrupt the proceedings of the house. As the house assembled , Congress wanted to raise what it termed the alleged illegality in the introduction of new Rs 2,000 notes.

Filibustering has been the order of the day in both houses of parliament with opposition locking horns with the ruling party on the issue of withdrawal of the Rs 500 and Rs 1000 notes from circulation. The opposition has been repeatedly demanding that the Prime Minister come to parliament and address the concerns of the members on the issue that had inconvenienced the general public and small merchants. If the PM can speak at rallies why not in parliament, the opposition asked.

With commercial banks opening for the week after a day’s break for the first time since demonetization, people made a run on the institutions to exchange old invalid notes and withdraw cash. Even after two weeks since demonetization, people still had to sweat it out in long queues for hours as most ATM machines either ran out of cash or broke down.

Media reports from different parts of the country suggested that people were frustrated with banks running of cash leading sometimes to scuffles with bank staff. Despite government’s concession to families hosting weddings to withdraw about rs 2.50 lakhs per person, such people could not withdraw as banks turned them away for lack of  operational guidelines from the RBI in this regard.

To prevent a run on the banks by currency mules depriving others of a chance to withdraw, banks at many places have started using indelible ink to prevent them from queueing up again to exchange defunct notes, though the Election Commission has raised strong objection to indelible ink being used by banks in view of the upcoming elections next year in about five states including UP, Punjab and Goa.

India’s rural economy, which does most monetary transactions by cash only, is yet to see many villagers connected to the formal banking system. The last mile delivery of new currency notes has left rural India virtually scrambling for cash. Farmers and rural folk have also suffered because because RBI did not allow gramin banks or local cooperative banks to exchange or deposit the defunct notes by the farmers who had accounts in them.

A report in a leading financial daily claimed that government’s demonetization move throttled sowing of Rabi crop as compared to the same time last year. “Uttar Pradesh has covered 1.5 million hectares so far while the biggest wheat producing state has set a target of 9.9 million hectares. Till now, wheat has been sown in Punjab in 2.4 million hectares while the target for the season is 3.5 million hectares. In Haryana, the grain has been sown in only 8,50,000 hectares so far while the target for 2016-17 session is to cover 2.5 million hectares,” the report stated.

Taking into view the sufferings of the rural folk, the government has issued orders to ease the burden on the cash strapped agrarian economy. Apart from announcing the relaxation in buying seeds, the government had on Thursday increased the withdrawal limit for farmers to 25,000 apart from allowing them a 15 day grace to pay their crop insurance premia.

The state governments have mobilized their efforts on a war footing to ease the pressure on the agro economy, ahead of the sowing season. While the Uttar Pradesh government has asked the district magistrates to ensure cash availability in their respective regions, Punjab government decided to provide fertilizers and other farm inputs in kind to farmers for sowing of the Rabi crops, media reports trickling from different states suggest.

The Himachal Pradesh government , according to reports , deployed helicopters for dispatching Rs 2,000, Rs 100, Rs 50 and other small denomination notes to far-flung, remote and tribal areas of the state to ensure adequate supply of valid currency.

By Sarkaritel November 22, 2016 10:26