Focus now on printing Rs500 notes; 'surgical strikes' to continue

16 December 2016

Economic affairs secretary Shaktikanta Das on Thursday said that while initially the focus was on printing Rs2,000 notes, now the focus has been shifted to Rs500 notes as there is enough circulation of the former now. He also estimated that in another 10 days about 50 per cent of the value of notes demonetised will be replaced.

Referring to the increased income tax raids on various individuals and bank branches, he said the enforcement agencies are conducting surgical action against cash hoarders. He, however, did not give out details as to how much the government has been able to garner through these actions.

He said the seized Rs2,000 notes will be returned to the system as soon as possible. There has been criticism that while the common man is finding it difficult to get hold of new currency notes, many rich and wealthy people have been able to hoard the new notes.

Das said of the 2.2 lakh bank ATMs in the country, over 2 lakh have already been re-calibrated. But banks prefer to supply cash via branches rather than ATMs as they want to serve their own customers. "We have requested the banks to continue dispensing cash via ATMs," he said.

He said the total number of notes in lower denominations of Rs100 and below supplied in the last five weeks since demonetisation is three-fold higher than what the Reserve Bank of India supplies in a year.

On 8 November about Rs1.6 lakh crore worth of Rs100 crore notes were in circulation. The RBI has now supplied about Rs80,000 crore worth additional Rs100 notes to the market.

Also he said the government is taking steps to streamline the distribution of cash. Towards this objective, district coordinators of state level banking committees are being asked to coordinate with the currency chests.

They will ensure that the cash from the currency chests is being equitably distributed all banks. This will also avoid criss-cross movements.

Airlifting of notes is being done where ever necessary, he said.

The banks have been told to tighten their surveillance and vigilance mechanism to keep a check on the hoarders.

The income tax raids and other actions taken by enforcement agencies are based on specific inputs. "You may call it surgical action," he said.

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