In­dia shuts banks as it prints new ru­pee no­tes

Times of Suriname - - ENGELS -

IN­DIA - Banks and ATMs all over In­dia we­re clo­sed yes­ter­day, fol­lo­wing Pri­me Mi­nis­ter Na­ren­dra Mo­di’s shock de­ci­si­on a day ear­lier to wit­h­draw 500 and 1,000 ru­pee no­tes — the coun­try’s two lar­gest de­no­mi­na­ti­ons — from cir­cu­la­ti­on at mid­night.

In­dians use cash for most trans­ac­ti­ons, and the me­a­su­res we­re ma­king it hard for them to con­duct bu­si­ness or pur­cha­se eve­ry­day items. “Eve­ry­o­ne is fa­cing a dif­fi­cul­ty right now,” said Pra­vin, an Uber dri­ver. He was searching for a bank or sto­re that would ex­chan­ge his three 1,000 and four 500 ru­pee no­tes for smal­ler bills. “If I don’t get mo­ney, I won’t work to­day,” he said. The cur­r­en­cy mo­ve is an at­tempt to com­bat cor­rup­ti­on and re­co­ver “black mo­ney,” bil­li­ons in il­legal funds of­ten stas­hed over­seas by tax eva­ders.

For now, it means an in­cre­di­ble 23 bil­li­on no­tes (mo­re than 80% of tho­se in cir­cu­la­ti­on) are now just “pie­ces of pa­per,” as Mo­di put it du­ring his speech Tues­day. They will ei­ther ha­ve to be de­po­si­ted or ex­chan­ged. That will ha­ve to wait till banks re­o­pen on Nov.10, which is when the Re­ser­ve Bank of In­dia says it will roll out new hig­her se­cu­ri­ty 500 and 2,000 ru­pee no­tes. The shut­down should al­low banks to stock up on the new no­tes, alt­hough ATMs will on­ly ha­ve them a day la­ter.

Ma­ny we­re con­fu­sed by the an­noun­ce­ment and the bank clo­su­re, even if they re­cog­ni­zed Mo­di’s de­ci­si­on could be good for the coun­try. “It’s very dif­fi­cult, I need to buy food for my kids,” said Vij­ay Ku­mar, a se­cu­ri­ty gu­ard and fa­ther of three. “I need to chan­ge the­se no­tes, but we don’t know what to do. Not eve­ry­o­ne has a TV in their ho­mes.” The news went down bad­ly on In­dia’s fi­nan­ci­al mar­kets, which al­so suf­fe­red from the glo­bal sell-off trig­ge­red by Do­nald Trump’s sur­pri­se vic­to­ry in the U.S. pre­si­den­ti­al elec­ti­on. The main SENSEX in­dex fell mo­re than 5%. (CNN.COM)

Men stand in front of a clo­sed bank branch in In­dia.(Pho­to: Get­ty Ima­ges)

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