Demonetisation: Karnataka urges Centre to extend deadline for using old notes

CM Siddaramaiah also sought lifting of curbs on using old currency notes for utility payments and other categories

Karnataka Chief Minister Siddaramaiah on Tuesday urged the Centre to extend the deadline for using old notes for exempted categories to December 30 from November 24 to mitigate the hardships of people after the November 8 demonetisation.

He also sought the inclusion of more services where the demonetised notes could be used, like blood banks, private hospitals and nursing homes, diagnostic labs etc.

"Extend the time limit for the use of old currency (Rs 500 and Rs 1,000) in exempted categories till December 30, as it has been given to exchange them for all till then," said Siddaramaiah in a letter to Union Finance Minister Arun Jaitley.

Reviewing the situation arising out of the currency shortage after the higher value notes were scrapped on November 8, the Chief Minister said limited availability of the new Rs 500, and other notes (Rs 100 and Rs 50) was causing untold misery to millions of people across the state, as they were unable to pay for daily needs.

"As the time limit for exempted categories has been extended to November 24 on Monday, allowing it till December 30 will help all pay for various utilities, including water and power bills with the old currency," reiterated Siddaramaiah in the letter, a copy of which is with IANS.

The Chief Minister also sought lifting of curbs on using the old currency for utility payments to other categories such as the small and medium sectors than limiting it to individuals and households as they are meant for the services availed already.

"Since currency shortage between Rs 100 and Rs 2,000 in the market is causing problems for all, there is an urgent need for new Rs 500, Rs 100 and Rs 50 notes than Rs 2,000 note, which can be given later," asserted Siddaramaiah.

Exempted categories were extended to paying bills in state-run hospitals and their medical shops, purchase of essential commodities in cooperative stores, buying train and air tickets and fuel at petrol and diesel outlets.

"You should extend the benefit to all private hospitals, nursing homes, diagnostic labs, blood banks and private medical stores.

"Banks should also be advised to set up priority counters for receiving payments in old currencies after duly authenticating them," noted the letter.

Similarly, traders and businesses should be allowed to pay in advance in old currency, giving relief to all and defusing the crisis.

Observing that cooperative banks depend on currency chests of the commercial banks for their daily cash requirement, the Chief Minister said the finance ministry should direct them (banks) to increase their limit to at least Rs 50-75 crore from Rs 25 crore, which is affecting thousands of their customers, including farmers who are dependent on cooperatives.

"Minimum withdrawal limits for registered traders and commission agents of the APMC markets should be enhanced to enable them to pay small and marginal farmers in cash," added Siddaramaiah in the letter.