India's war on cash devastates the country

The global war on cash has devastated India and its economy as the central bank attempts to crack down on black market transactions.

Last month the Central Bank of India decided to abolish 500 and 1,000 rupee bank notes.

The banned bills made up more than 80 percent of the currency in circulation, leaving millions of people without cash and bringing the cash-driven economy to a halt.

Thursday market the first payday for much of the country since the government crackdown. Millions of Indians stood on lines outside of banks attempting to cash, what may fear may be worthless paper checks as banks run out of small denominated bills.

Since the Nov. 8th decree, scores of Indian farmers have committed suicide as a result of being unable to pay debts associated with planting for the coming growing season.

There are numerous reports of tempers flaring as hundreds of thousands of people queued up for hours outside the country’s banks.

“There’s chaos everywhere,” said Delhi Chief Minister Arvind Kejriwal, a rival of Prime Minister Narendra Modi, accusing the premier of wreaking havoc on poor and working Indians while the wealthy found ways to skirt the new rules.

Nearly half of India’s 202,000 ATMs have been shut down during the crisis. Those that operated quickly ran out of the new notes as scores of people descended upon them.

Finance minister Arun Jaitley said ATMs had not been adjusted to handle new currency notes prior to the announcement in order to keep it under wraps. “Recalibration of ATMs will be completed within two weeks,” he added.

“There is an acute shortage of cash in the banks and ATMs. We have only 25 percent of what is required at this time of the month when salaries are taken out by about 20 million people,” C. H. Venkatachalam, general secretary of the All India Bank Employees Association told the Washington Post

“The bank staff are facing unimaginable mob anger and abuse. In some cases, the angry crowd has locked them up from outside and the staff had to call the police to come and rescue them,” Venkatachalam added.


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