Cash crisis to last 2-3 weeks more, says Arun Jaitley

New Delhi: Even as anger rose among millions of Indians running out of cash after Tuesday’s demonetisation of high-value notes, the government said on Saturday that it would take “two to three weeks” to fix the two lakh-odd ATMs to cope with the currency shake-up.

Union finance minister Arun Jaitley said that the government did not go for prior re-calibration of ATMs because it wanted to keep the move to demonetise Rs 1,000 and Rs 500 notes a secret to ramp up India’s fight against black money.

“Prior calibration would have given the whole game away,” said Mr Jaitley, even as wilting banks and ATMs battled winding queues, scuffles, minor stampedes for a third straight day.

Banks will remain open over the weekend but the crisis may deepen on Monday when they would be shut in some parts of the country because of state holidays.

Many families comprising even the elderly and women jostled in lines to improve their chances of exchanging or withdrawing money. Either ATMs were unable to meet the spiraling demand for cash, or they could not dispense the new bills.

Traders in many areas downed  shutters, threatening to grind large parts of India’s cash-driven economy to a halt, while grocers charged exorbitant prices. Frustrated weekend crowds struggled to pay for food, fuel and other daily needs in a chaos that began on Thursday, two days after the government spiked 86 per cent of Indian currency notes worth Rs 14 lakh crore. Banks and ATMs remained closed on Wednesday.

“The crowd is five times more than what we saw on the first day,” said a bank manager in Delhi. So far there have been reports of five deaths in the ongoing chaos across states despite heavy police presence at banks and ATMs. Much of India’s rural economy is powered by cash transactions with few people having bank accounts or operating one even if they have an account.

Mr Jaitely regretted the inconvenience and appealed to people not to crowd banks to deposit invalid notes as the window for doing so is till December 30.

Approximately Rs 2 lakh crore has so far been deposited in all banks.

The finance minister said thousands of people are busy fixing the ATM problem, and there is enough cash to tide over the problem. About 25 per cent of old notes are yet to be taken out of ATMs.

The government is looking into the sudden “cropping up” of Rs 2 lakh crore in zero-balance Jan Dhan accounts within two days of the demonetisation move, Mr Jaitely said, even as Opposition leaders Arvind Kejriwal and Mamata Banerjee escalated their attack on the government, seeking a rollback of the move.

“Once the ATMs are functional, people can withdraw a maximum of Rs 2,000 per card per day up to November 18, and after that Rs 4,000 per day per card,” an RBI statement said. The government has also extended the validity of withdrawn currency for paying public utility bills till November 14.