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Cash crunch worsens in rural Gujarat

Press Trust of India  |  Ahmedabad 

The ongoing cash in worsened today with several and banks running dry, especially in villages and the tribal belts, even though the Centre played down the issue terming it as only "temporary shortages".

Nitin Patel, who is also the state minister, acknowledged that banks are facing cash and said the government is in touch with the to ensure enough cash is supplied to banks.

The demand for cash has increased since this is the harvest and marriage season in the state.

Bank officials said they are getting only one-tenth of the required cash leaving them helpless to replenish the This has especially affected farmers involved in cumin business, they said.

It can be noted that several parts of Andhra, Telangana, MP, and poll-bound have been reporting cash shortages at and banks for some time now, but minister today attributed to unusual spurt in demand in the past three months.

Denying that there is any shortage of currency in circulation, Jaitley said the "temporary shortage" in certain states is being "tackled quickly" and that there is "more than adequate" currency in circulation.

"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," he Tweeted.

Several ATMs in Ahmedabad and other cities remained dry today, making it difficult for people to get cash for daily needs.

The situation is more acute in rural and tribal areas, bank officials and Opposition political leaders said.

"This is the fourth that I am visited which has a "no cash" board outside. I need cash for business but I am not sure where I will get it," said an aggrieved Shashikant Sharma outside the branch near the Anjali Crossroad area in Ahmedabad.

"I have to pay the rent and this is the third that I visited since the past two days but none of them had cash," said another affected person standing outside a in Prahlad Nagar locality in the city.

While some banks have put up "no cash" boards outside their ATMs, others have "ATM temporarily out of service" or "ATM under maintenance" boards.

of Maha Bank Employees Association Janak Raval said banks in urban areas are getting only one-tenth of the cash required.

"Rural areas are the worst hit. North is badly affected. People involved in cumin trade are helpless as most of their transactions are in cash," he said.

He said the state has been suffering since the past 10 days, but the matter has aggravated in the past few days.

MLA from Patan Kirit Patel said the farmers are the worst hit. He said has written to the Union minister to make available immediately at least Rs 20 crore to banks so that farmers in north Gujarat do not suffer any more.

"This is the marriage season, and also the harvest season, so many people need cash. But since most ATMs and banks are having cash crunch, farmers in great trouble. I have written to the to immediately make available Rs 20 crore in north Gujarat area so that farmers do not have to suffer more," he said.

The had on Monday acknowledged that banks were facing cash and he had asked the to address the problem.

"Since the past four-five days, banks in the state are not getting enough cash. I have talked to the of twice regarding the issue and have also asked the chief secretary to discuss the matter with him and ensure that banks get money. We are constantly in touch with the RBI," he had said on Monday.

While currency supply increased by Rs 45,000 crore in the first 13 days of April, "unusual spurt in demand" was seen more in some parts of Andhra, Telangana, Karnataka, and Bihar, it said.

The RBI report shows that the currency in circulation has reached the pre-demonetisation level of about Rs 17 trillion.

Meanwhile attributed that issue to an "imbalance" due to the crop procurement season in Punjab, and UP where there is heightened demand.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, April 17 2018. 18:46 IST
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