Feedback no.2 to Finance Minister on Demonetization and its aftermath.
ALERT CITIZENS FORUM OF INDIA
(Unit of Righteous Foundation - Regd NGO)
A7/303, Saket CHSL, Saket Marg, Thane (W) 400601.
November 17, 2016.
The Hon. Finance Minister,
Govt of India,
New Delhi.
Sub: Feedback no.2 on Demonetization and its aftermath.
Respected Sir,
Greetings to you as we send our Alert Citizens Forum second feedback on the above subject.
The historic decision to demonetize ₹ 500/1000 currency notes was received by the country with great hope and positive vibes.
The people had initially lapped up the appeal by the respected Prime Minister and your good self that there will be initial problem while implementing the decision.
Sir, now 8 days after the announcement of the decision the inner feeling I am getting is that the demonetization has hit a big roadblock.
Yesterday we had conducted a survey in Mumbai and Thane over 3000 respondents on Demonetization and its aftermath for a client. The findings were as under:
75% supported the move from day 1.
However, of that 75%, 36% people were now having second thoughts.
And in all, 80% people felt that the government has mismanaged the implementation part of it.
54% felt that introducing the new 2000/- note was not required and the government should have printed a new series of ₹ 100/- currency notes well in advance to have avoided the chaos in banks and ATMs. 56% people doubted that this demonetization will not curb black money.
People are in favour of Demonetization but feel that the implementation could have been much better.
Common Problems faced :
1) *Non operational ATMs*
Many ATMs are not operational (shutter down). People feel that with RBI waving off the transaction charges many bank are not interested in maintaining their ATMs as it earns them NO revenue.
ATMs should have been replenished thrice in a day with such huge demand for currency.
2) *Banks giving ₹2000*
Its good to get a 2000 currency for the novelty factor, but who will give you change when you are in the market to buy something.
3) *Lack of availability ₹500*
People feel that ₹500 should have been Printed, Stocked and Ready for dispatch on the 8th while the announcement of taking the old design out of circulation was made.
Today 8 days after the Demonetization announcement there is still
▪Not enough cash in ATMs,
▪Hardly any ₹500,
▪Long Long lines in ATMs.
We did a quick reality check as to what could be the possible causes of the inadequacy in availability of notes in banks.
We studied the following link along with the various economic reports:
https://factly.in/capacity-
and found that in terms of value, Rs 500 & Rs 1000 notes made up for more than 86% of the notes in circulation, which is more than 14 Trillion rupees (14 Lakh Crores).
The printing capacity of the current printing presses in the country may not be sufficient to meet the demand for the new Rs 500 and Rs 2000 notes.
India can print around 2 billion pieces of currency notes a month :
4 lakh crore in 2000 rupee notes only
OR
1 lakh crore in 500 rupee notes only
OR
0.2 lakh crore in 100 rupee notes only.
We have withdrawn 14 lakh crores from the economy + (the counterfeit Pakistani notes.).
We assumed that we have been printing for about 3 months most of these 2000 rupee notes but notes of 500 and 100 must have been printed as well.
By conservative estimates we may have up to 8 lakh crore in out treasury chest.
We assume that it had been calculated that the 2000 rupee note would be the mainstay of the economy and so were focused on.
These 2000 rupee notes have not been user friendly as the masses found them un-spendable, as nobody was ready to give change after accepting the notes due to liquidity crunch.
We assume that to print adequate 500 rupee notes to cover the shortfall due to the 2000 rupee notes is likely to take another 6 months at the least and if additional 100 rupee notes have to be printed then the printing time can go to a year.
There is the option that the situation will ease once enough 500 rupee notes come into the system cause their presence will make the 2000 rupee spendable.
It will be at least January before we have a semblance of normalcy… and for the economy to be full up and running it might be late mid 2017.
Sir, today the Supreme Court has warned that unless the Government takes urgent measures to make currency available for payment with banks, the country faces the grim prospects of riots as public patience is fast waning.
We request you to please note the points mentioned above and trust you will take measures to alleviate the grievances of the people.
As expressed in our earlier letter, our services are at your disposal for any assignment that will help in reducing the hardships of the people.
Regards,
For Alert Citizens Forum of India,
Dayanand Nene
President
Socio-political activist:
• Bharatiya Janata Party, Mumbai.
• Consumer Protection Service Council
Alert Board: Jitendra Satpute, Prasad Bedekar, Ganesh Iyer, Kiran Joshi, CS Sandhya Malhotra, Sangita Koganur, Swati Bedekar, Sanjeev Pande, Pramod Date, Parikshit Dhume, Sudesh Khatawkar.
(Unit of Righteous Foundation - Regd NGO)
A7/303, Saket CHSL, Saket Marg, Thane (W) 400601.
November 17, 2016.
The Hon. Finance Minister,
Govt of India,
New Delhi.
Sub: Feedback no.2 on Demonetization and its aftermath.
Respected Sir,
Greetings to you as we send our Alert Citizens Forum second feedback on the above subject.
The historic decision to demonetize ₹ 500/1000 currency notes was received by the country with great hope and positive vibes.
The people had initially lapped up the appeal by the respected Prime Minister and your good self that there will be initial problem while implementing the decision.
Sir, now 8 days after the announcement of the decision the inner feeling I am getting is that the demonetization has hit a big roadblock.
Yesterday we had conducted a survey in Mumbai and Thane over 3000 respondents on Demonetization and its aftermath for a client. The findings were as under:
75% supported the move from day 1.
However, of that 75%, 36% people were now having second thoughts.
And in all, 80% people felt that the government has mismanaged the implementation part of it.
54% felt that introducing the new 2000/- note was not required and the government should have printed a new series of ₹ 100/- currency notes well in advance to have avoided the chaos in banks and ATMs. 56% people doubted that this demonetization will not curb black money.
People are in favour of Demonetization but feel that the implementation could have been much better.
Common Problems faced :
1) *Non operational ATMs*
Many ATMs are not operational (shutter down). People feel that with RBI waving off the transaction charges many bank are not interested in maintaining their ATMs as it earns them NO revenue.
ATMs should have been replenished thrice in a day with such huge demand for currency.
2) *Banks giving ₹2000*
Its good to get a 2000 currency for the novelty factor, but who will give you change when you are in the market to buy something.
3) *Lack of availability ₹500*
People feel that ₹500 should have been Printed, Stocked and Ready for dispatch on the 8th while the announcement of taking the old design out of circulation was made.
Today 8 days after the Demonetization announcement there is still
▪Not enough cash in ATMs,
▪Hardly any ₹500,
▪Long Long lines in ATMs.
We did a quick reality check as to what could be the possible causes of the inadequacy in availability of notes in banks.
We studied the following link along with the various economic reports:
https://factly.in/capacity-
and found that in terms of value, Rs 500 & Rs 1000 notes made up for more than 86% of the notes in circulation, which is more than 14 Trillion rupees (14 Lakh Crores).
The printing capacity of the current printing presses in the country may not be sufficient to meet the demand for the new Rs 500 and Rs 2000 notes.
India can print around 2 billion pieces of currency notes a month :
4 lakh crore in 2000 rupee notes only
OR
1 lakh crore in 500 rupee notes only
OR
0.2 lakh crore in 100 rupee notes only.
We have withdrawn 14 lakh crores from the economy + (the counterfeit Pakistani notes.).
We assumed that we have been printing for about 3 months most of these 2000 rupee notes but notes of 500 and 100 must have been printed as well.
By conservative estimates we may have up to 8 lakh crore in out treasury chest.
We assume that it had been calculated that the 2000 rupee note would be the mainstay of the economy and so were focused on.
These 2000 rupee notes have not been user friendly as the masses found them un-spendable, as nobody was ready to give change after accepting the notes due to liquidity crunch.
We assume that to print adequate 500 rupee notes to cover the shortfall due to the 2000 rupee notes is likely to take another 6 months at the least and if additional 100 rupee notes have to be printed then the printing time can go to a year.
There is the option that the situation will ease once enough 500 rupee notes come into the system cause their presence will make the 2000 rupee spendable.
It will be at least January before we have a semblance of normalcy… and for the economy to be full up and running it might be late mid 2017.
Sir, today the Supreme Court has warned that unless the Government takes urgent measures to make currency available for payment with banks, the country faces the grim prospects of riots as public patience is fast waning.
We request you to please note the points mentioned above and trust you will take measures to alleviate the grievances of the people.
As expressed in our earlier letter, our services are at your disposal for any assignment that will help in reducing the hardships of the people.
Regards,
For Alert Citizens Forum of India,
Dayanand Nene
President
Socio-political activist:
• Bharatiya Janata Party, Mumbai.
• Consumer Protection Service Council
Alert Board: Jitendra Satpute, Prasad Bedekar, Ganesh Iyer, Kiran Joshi, CS Sandhya Malhotra, Sangita Koganur, Swati Bedekar, Sanjeev Pande, Pramod Date, Parikshit Dhume, Sudesh Khatawkar.
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