Cash crunch will negatively affect growth rate: Chandrababu Naidu

Amid a furore over a reported cash crunch, Andhra Pradesh Chief Minister N. Chandrababu Naidu said currency shortage will have a negative impact on the growth rate and society.

Naidu further noted the reasons for currency shortage and demanded to evolve an action plan to solve the problem.

"When banks fail to manage at the macro level, they can't do anything at micro level. Banks are virtually creating panic among the public. Currency shortage will have a negative impact on the growth rate and society," Naidu said, while addressing a State-level Bankers' Committee (SLBC) meeting at the Grievance Hall at his residence in Undavalli.

Chief Minister Naidu also expressed concern that the people may no longer come forward to deposit their money in the banks if the customer service fails to improve.

He said the bankers should cooperate in the implementation of distribution of pension in cash and several other welfare programmes.

According to media reports, the SLBC later decided to request the RBI and the Department of Financial Services of Central government to make a detailed study of the cash shortage problem and come out with a comprehensive policy frame work to resolve the issue.