Currency supply still below 50% of pre-note ban days

January 15, 2017

New Delhi, Jan 15: Almost 10 weeks after Prime Minister Narendra Modi announced the demonetisation of high-value banknotes on November 8, there are no signs of a recovery on the cash-availability front.

cash

The dramatic downward trend of the currency liquidity situation, triggered by the demonetisation of Rs 500 and Rs 1,000, valued at around Rs. 15.44 lakh crore, has continued, despite the government’s claims to the contrary.

Latest weekly data released by the Reserve Bank of India (RBI) on Friday revealed that the currency in circulation as on January 6 was just over 49% of the volume of money that was with the public four days before Modi announced the demonetisation drive.

As against Rs. 17.74 lakh crore that was in circulation on November 4 last year, the money in circulation on January 6 was Rs 8.73 lakh crore, according to the data.

The figures reveal that the money in circulation has continuously dropped week after week since early November. There is no recovery yet to regain even levels close to the pre-demonetisation days.

Experts familiar with the situation told DH that the recovery depended on the capacity to print new notes and then effectively distribute them across the country through banking channels.

On both the fronts, there have been severe limitations so far, they added.

In view of the sharp decrease in the availability of cash in the economy, the RBI is yet to ease the existing rules on the post-demonetisation restrictions on cash withdrawals from banks and ATMs.

The experts said, going by the trend so far, it will take at least eight to 10 weeks to restore a semblance of normalcy with regard to currency circulation, after the first signs of recovery are available.

Unless the currency circulation vastly improves, experts feel that the economy will not recover. The government and international banks have already pegged down the GDP growth figures. However, they said that the currency circulation need not be restored to the Rs 17.74 lakh crore of the pre-demonetisation period.

“There was a portion of black money hoarded in cash... Most of that has now entered the banking system in the form of deposits made with demonetised banknotes,” one expert said.

In view of this, it is reckoned that a new currency normalcy could be achieved with a circulation level of around Rs 2 lakh crore below the pre-demonetisation level of circulation.

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News Network
May 4,2024

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Canadian Police said they have arrested three Indians they suspect were part of the alleged hit squad that had killed Hardeep Singh Nijjar, a Sikh separatist leader involved with the Khalistan movement, which calls for an independent Sikh state.

Nijjar's killing had become the epicentre of a diplomatic row between India and Canada last year after Prime Minister Justin Trudeau alleged the role of "Indian agents" in the murder. India had rejected the charge as "absurd" and "motivated".

The three arrested Indians - Karan Brar, 22, Kamalpreet Singh, 22, Karanpreet Singh, 28 - were living as non-permanent residents in Alberta for three to five years, said Superintendent Mandeep Mooker, who leads the Integrated Homicide Investigation Team. The police have also released their photos.

They have been charged with first-degree murder and conspiracy to commit murder, showed court documents.

Police said that none of the suspects were known to them earlier and they were investigating their possible ties to the Indian government.

The murder remains "very much under active investigation," Royal Canadian Mounted Police (RCMP) Assistant Commissioner David Teboul told a press conference on Friday.

"There are separate and distinct investigations ongoing into these matters, certainly not limited to the involvement of the people arrested today, and these efforts include investigating connections to the government of India," CTV News quoted him as saying.

Nijjar, a Canadian citizen who was wanted in India on various terror charges, was shot dead outside a gurdwara in Surrey on June 18, 2023. Trudeau's charge against India sparked a massive row later that year with both countries expelling diplomats of the other country.

A fresh row erupted earlier this week after separatist slogans on 'Khalistan' were raised at an event addressed by Trudeau, prompting New Delhi to summon their Deputy High Commissioner and lodge a strong protest.

On the sidelines of the event, Trudeau told reporters that Nijjar's killing had created a "problem" that he could not have ignored.

India rejected his comment and said it once again showed Canada provides political space given to separatism, extremism, and violence. "This not only impacts India-Canada relations but also encourages a climate of violence and criminality in Canada to the detriment of its own citizens," foreign ministry spokesperson Randhir Jaiswal said.

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News Network
April 29,2024

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In yet another setback to the Congress party amid the ongoing Lok Sabha elections, its candidate from Indore Akshay Kanti Bam withdrew his nomination on Monday, April 29, days before voting.

Interestingly, he had reached the Collector's office with BJP MLA Ramesh Mendola to withdraw his nomination. He also reportedly joined BJP. 

Senior BJP leader and state cabinet minister Kailash Vijayvargiya in a post on X said Bam was welcome to join the BJP.

"Congress Lok Sabha candidate from Indore Akshay Kanti Bam is welcome in the BJP under the leadership of Prime Minister Narendra Modi, party national president J P Nadda, Chief Minister Mohan Yadav and state president VD Sharma," he said in the post.

The Congress had fielded Bam against sitting BJP MP Shankar Lalwani from the Indore Lok Sabha seat, where polling will be held on May 13.

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News Network
April 25,2024

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The Election Commission of India on Thursday announced that it had taken cognisance of violations to the Model Code of Conduct by both Prime Minister Narendra Modi and Congress leader Rahul Gandhi.

While Modi has indulged in a diatribe against Muslims, without naming them, using terms like 'infiltrators' and 'those with more children', Rahul has been accused of making a false claim about 'rise in poverty'.

Both the BJP and INC have raised allegations of causing hatred and divisions based on caste, religion, language, and community, ANI reported.

While the EC had initially refused to comment on Modi's speeches, sources had told PTI that the commission was 'looking into' the remarks made by the BJP leader.

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