 "We are shipping money to banks: Jaitley")
The government on Wednesday tried to calm people who might have to queue up to withdraw money from banks on Thursday when they open a day after Rs 500 and Rs 1,000 currency notes were scrapped.
"We need two to three weeks for a complete replacement of high-denomination currency notes. We are striving to make cash available in post offices and banks via RBI currency chests," Finance Minister Arun Jaitley said at a press conference. The RBI will issue new Rs 500 and Rs 2,000 notes from Thursday.
"We will tweak the cash withdrawal limits on an ongoing basis. Railway stations, medicine outlets, toll gates and ASI buildings will accept old notes," he added.
Prime Minister Narendra Modi on Tuesday announced existing Rs 500 and 1,000 notes could be deposited by people in banks and post offices between November 10 and December 30 by showing identification proof.
There is no limit on such deposits, but if old notes are exchanged for new ones, there is a cap of Rs 4,000 till November 24. There will also be a cap of Rs 10,000 a day and Rs 20,000 a week on withdrawals from banks and Rs 2,000 a day from on withdrawals from ATMs. This limit will be increased in the coming days.
Financial Services Secretary Anjuly Chib Duggal said banks had been asked to open more counters and keep refilling ATMs. She said her department was in touch with the Reserve Bank of India and was monitoring cash availability. An RBI notification said banks would remain open on Saturday and Sunday.
The road ministry said it had suspended toll collection on National Highways till Thursday midnight. A sudden rush at ticket counters forced the railways to ask the RBI to issue lower denomination notes from its regional centres to the railway zones concerned with immediate effect. The railways generate about Rs 126 crore in ticket revenue daily.
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Mother Dairy booths were seen accepting Rs 500 and Rs 1,000 notes only if buyers showed identity cards and if they bought goods worth either Rs 500 or Rs 1,000.
People faced problems buying essential items and using public transport as there was a dearth of change. Fuel pumps and toll plazas saw long queues.
"I am sure people will cooperate in dealing with the difficulties and inconvenience that they might face. Eventually, things will settle down," Finance Secretary Ashok Lavasa said.
Jaitley did not agree with the view the economy would slow down because of the move. "The prime minister's decision will expand the GDP," he said. "The decision will increase direct and indirect tax collections in the medium and long term," he added.
The Central Board of Direct Taxes is working on the role it will play once the old currency notes come up for exchange. The income tax department would work with banks and the Financial Intelligence Unit to track suspicious transactions, sources said.