Further demonetisation relaxation likely for farm sector, weddings

The Narendra Modi government might announce a number of relaxations pertaining to demonetisation for the farm sector, cooperatives and marriages functions on Wednesday. 

Economic Affairs Secretary Shaktikanta Das would hold a press conference on Wednesday morning, the finance ministry said on Tuesday.

While the agenda of the briefing was not given, Finance Minister Arun Jaitley had said earlier in the day said that the Centre’s focus would now be on rural areas and more measures would be announced for farmers. “The situation is normalising in the urban areas. In the next few days, the focus will be on the rural areas so that farmers have enough funds because it is rabi-sowing season.

 A few decisions were taken yesterday (Monday) night which will be made public today (Tuesday),” Jaitley had said while addressing Bharatiya Janata Party MPs in a parliamentary party meeting. 

However, no decisions were made public on Tuesday and it is likely that Das will list out new relaxations on Wednesday morning. Some relaxations could also be on the anvil for cooperative societies and institutions, as well as for weddings, Business Standard has learnt. 

Speaking at the parliamentary party meeting, Jaitley said the credit flow from banks would also go up for various activities including agriculture as huge amounts of cash due to demonetisation were deposited in the banking system. 

The finance minister also said that once there was enough new cash in the system, the government would ease all restrictions but till then some difficulties would persist. 

On Monday, the finance ministry had permitted farmers to use old Rs 500 notes for purchasing seeds from any state or central government outlets and agri universities. The government has also allowed farmers to draw up to Rs 25,000 per week from their KYC (know your customer)-compliant accounts or farm loans subject to the normal loan limits and conditions apart from the other facilities announced last week.