THE Indian government on Thursday (Nov 17) lowered the exchange limit for now-defunct 500 and 1,000 rupee notes to Rs 2,000 from the existing cap of Rs 4,500, effective Friday (Nov 18) but has given a big relief to farmers ahead of the sowing season and to families planning weddings.
'To enable larger number of people to get benefit of over-the-counter exchange of Rs 500 and Rs 1,000 notes, the existing limit of Rs 4,500 will be reduced to Rs 2,000 with effect from tomorrow,' Economic Affairs Secretary Shaktikanta Das told reporters in New Delhi.
Among other measures, the government has allowed up to Rs 2.5 lakh cash withdrawal from bank account of a bride or groom or their parents for a marriage during the ongoing wedding season.
The decisions come even as long queues outside abnks remained a common sight for the eighth day on Wednesday (Nov 16) even after the government directed banks to put indelible ink mark on the right index finger of persons to screen them from using the exchange facility more than once.
The Centre has also given the option to its lower level employees up to Group C to draw an advance of Rs 10,000 from their November salaries.
Besides, it relaxed the weekly withdrawal limits for farmers and Agriculture Produce Market Committee (APMC) traders.
It also allowed withdrawal of up to Rs 2.5 lakh from bank accounts for the explicit purpose of weddings.
Das said that central government employees up to group C, including those of state-owned companies, military, railways and para-military organisations, will be given the option of taking salary advance up to Rs 10,000 in cash, which will be adjusted against their November salaries.
Given that crop sowing has slowed down at the commencement of Rabi Season due to a cash crunch, the centre will now also allow farmers farmers to draw Rs 25,000 per week against farm loans sanctioned or Kisan credit cards to meet their expenses. Farmers can also withdraw the same amount per week from their own accounts.
For traders in APMC markets the weekly withdrawal limit now stands at Rs 50,000 per week for their business requirements. Das said that these provisions are subject to strict KYC norms.
'Different states have different payment timelines for crop insurance premium. The central government has decided that time limit in cases of payment of crop loan insurance premium will be extended by 15 days,' Das said.
Given that it is wedding season in India and a lot of complaints have been received from people with wedding ceremonies in their families, Das also announced that up to Rs 2.5 lakh will be permitted to be drawn from one of the bank accounts, either the bride or the groom, or immediate kin.
Prime Minister Narendra Modi had on November 8 demonetised Rs 500 and Rs 1,000 notes in his bigger war against black money, terror financing and counterfeit notes
